Intra-Sector Rotation Favors Software π The Chart Report
Chart of the Day
π Today's Chart of the Day was shared by Sam Gatlin.
The Software ETF (IGV) broke to new 3-month highs today, as the Equal Weight Software versus Semiconductor ratio (XSW/XSD) flashes a bullish momentum divergence.
Weβve witnessed historic dispersion between the two groups, with semiconductors trading farther above their 200-day moving average relative to software than ever before on record.
From here, investors face a choice: continue to lean into the relative strength of semis or rotate into the beaten down software group in anticipation of a sustained catch-up trade.
The Takeaway: After a historic run in semiconductors, software is setting up as the next potential opportunity within Tech.
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