Trading Themes to Watch Going Forward

Several trading themes emerged over the past month and these themes could have legs. Russia invaded Ukraine a month ago and the broader market is significantly higher since the invasion. The Russell 2000 ETF is up 6.81%, the S&P 500 SPDR is 7.29% higher and the Nasdaq 100 ETF is leading with a 9.09% gain. Note that small-caps are lagging. These are impressive gains, but the leading groups are not the usual suspects as new leaders emerged to reflect some new realities.   

The PerfChart below shows the performance for SPY, QQQ, IWM and eight ETFs since February 23rd. Notice that the Semiconductor ETF (SOXX) is up less and lagging the broader market. The Cybersecurity ETF (CIBR), in contrast, is leading within the technology sector and up more than twice as much as QQQ. Cybersecurity is emerging as an important theme and we should keep CIBR on our radar.

The other six ETFs are also up more than the broader market and represent emerging themes that could continue. These include energy (XLE), clean energy (PBW), defense (XAR), metals/mining (XME), agribusiness (MOO) and gold miners (GDX). These ETFs are also at the top of the performance ranking at TrendInvestorPro and represent the momentum leaders right now.

This week at TrendInvestorPro I continued the Trend Composite trading strategy series with part six. This part tested an ETF trend-momentum strategy with ATR Trailing Stops and fixed time exits. Click here for immediate access to this series and more.

On this week's Next Level Charting (video here), I reviewed the weight of the evidence for the broader market and the emerging themes over the past month.

The Trend Composite, ATR Trailing Stop and nine other indicators are part of the TIP Indicator Edge Plugin for StockCharts ACP. Click here to take your analysis process to the next level.

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