Getting a good read on each stock sector’s momentum is critical to consistently identifying market-beating trades.
That’s exactly what my Leaders & Laggards Board is all about!
Using the algorithm I designed for my Cycle 9 Alert service, the Leaders & Laggards Board ranks each of the U.S. market sectors based on their forward-looking momentum, from No. 1 (best) to No. 11 (worst).
Here’s what our Leaders & Laggards Board looked like last week…
Interpreting my Leaders & Laggards Board is simple.
Top-ranked sectors are poised to outperform the broad market over the next two to three months, while bottom-ranked sectors are more likely to underperform.
With only a quick glance, you can easily spot which sectors are “hot” and which are not.
Of course, while the Leaders & Laggards Board is a simple graphic, there’s a lot going on “under the hood,” to arrive at these rankings.
You see, my Cycle 9 Alert algorithm makes two important determinations about each sector:
- How much momentum is it showing, relative to the broad market.
- How much momentum is it showing, relative to its own recent past.
The first — a comparison to the broad stock market — is a classic feature of the momentum strategy.
The second, I believe, is more unique. And it’s particularly important for any trader who’s aiming to capture the highest rate of return from an investment, in a short amount of time.
In Cycle 9 Alert, we only allow ourselves two to three months in any one trade, so we’d better get the timing right!
Making sure a potential investment is beating the broad market is a start. But going one step further … and making sure that a potential investment is outpacing its own recent past is an added assurance that we’re positioning ourselves to capture the investment’s meatiest move.
This of course isn’t the only way you can measure momentum. But it’s the approach I’ve used for many years with great success. And it does a particularly remarkable job at identifying stocks and sectors that are poised to “pop” in the very near future.
That’s why I’m confident my Leaders & Laggards Board will always be able to tell me where the hottest sector plays are!
To good profits,
Chief Investment Strategist, Money & Markets
• Using his unique blend of technical and quantitative analysis, Adam’s sole focus is to find and bring you investment opportunities that return the maximum profit with minimum risk.