1/23/23 Flipping Sector Sentiment — Communication is In


On Friday, Markets opened green and struggled to find a seller.

The major indexes climbed throughout the day and closed at their highs. The “risk-on” Nasdaq led the way…

  • Dow Jones +1.0%
  • Nasdaq +2.7%
  • S&P 500 +1.9%
  • Russell 2000 +1.7%
Photo from Getty Images

There was no clear catalyst. But strong buying on a Friday shows the market has little fear of uncertainty.

The first option’s expiration of the year likely contributed to the outsized move.

Sector Round Up

All 11 sectors ended the day in the green.

At the top…

  • Communications (XLC) +3.1%
  • Technology (XLK) +2.7%
  • Consumer Discretionary (XLY) +2.0%

At the bottom…

  • Consumer Staples (XLP) +0.8%
  • Utilities (XLU) +0.6%
  • Healthcare (XLV) +0.5%

The Communications sector has officially broken out…

XLC Daily Candles – Chart via thinkorswim

Friday’s rally included notable stands from the sector… 

  • Alphabet (GOOG, GOOGL) +6%,+5%, respectively
  • Netflix (NFLX^) +8%

Communication aligned with Technology and Consumer Discretionary precisely as we’d expect to set in a traditional bull market.

We are designating Communication as a hot sector. Watch for new positions in the coming weeks.

Crypto Charge

Bitcoin^ reached a new 5-month high of 23,400 over the weekend.

  • The gains placed the price 50% higher than its November 2022 lows
  • Recent price action continues to align with our analysis


The S&P 500 looks extremely bullish.

The down-trending yellow line is the only bearish signal to be found.

SPY Daily Candles – Chart via thinkorswim

We see a cup-and-handle formation forming marked in orange.

The blue arrow points to a spinning top, which is common at market turning points.

The rest of the signals offer no alternative. Right now…


It’s a big earnings week.

Here are the highlights…

  • Logitech (LOGI) reports after hours today
  • Microsoft (MSFT) reports after hours on Tuesday.
  • Tesla (TSLA) after the close on Wednesday
  • Southwest (LUV) premarket Thursday

From the Feds … the advance Q4 GDP is due out Thursday morning.


*Low Float
^Open Position

*NEON support at $10
*APXC support at $3
*NINE support at $14
*BWEN support at $5, resistance at $6
BYSI support at $2.50
ATRO support at $12
SY on watch
VERA support at $8
^AEHR support at $30
SDRL on watch
ALGS support at $2
LX support at $3.40
ZYME support at $9
^CROX support at $115
AQMS support at $1.20
TOUR on watch
SPRU support at $1.25
ARDX support at $3
MNSO support at $14

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