Strength At The Top Masks Broad Weakness

While Tech climbs, breadth sinks

Key Takeaway: Technology (which is two stocks masquerading as a sector) is pushing to new highs while more stocks are seeing their 50-day averages break below their 200-day averages. Narrow pockets of strength are not bull market hallmarks.

Technology is breaking out to the upside on an absolute basis and is closing in on new highs versus Industrials. Technology is the most top-heavy of the S&P 500 sectors while Industrials is the most equally-weighted.

While the Tech sector powers higher, the percentage of stocks with 50-day averages above their 200-day averages has broken down to new cycle lows: