Market Cycle Analysis
This dashboard tracks the Relative Strength (RS) of each sector versus the S&P 500 (SPY). Sectors rotate clockwise through four phases: Improving → Leading → Weakening → Lagging.
LEADING
Strong Trend + Outperforming
XLB
Materials
3M: +19.29%
1M: +7.43%
$53.36
+0.76%
XLE
Energy
Top Pick
3M: +18.94%
1M: +12.72%
$55.1
-0.09%
XLI
Industrials
3M: +13.98%
1M: +8.44%
$176.98
+1.23%
XLP
Staples
Top Pick
3M: +10.9%
1M: +9.18%
$89.74
+0.87%
XLU
Utilities
Top Pick
3M: +2.79%
1M: +10.88%
$47.2
+1.11%
XLRE
Real Estate
3M: +2.62%
1M: +6.87%
$43.73
+0.28%
WEAKENING
Outperforming but Losing MomentumNo sectors currently weakening.
IMPROVING
Underperforming but Gaining Momentum
XLV
Healthcare
3M: -2.19%
1M: +0.63%
$157.87
-0.42%
LAGGING
Underperforming & Weak Trend
XLC
Comm. Services
3M: -0.49%
1M: -0.59%
$116.16
+0.69%
XLY
Discretionary
3M: -0.76%
1M: -3.79%
$116.74
+1.52%
XLK
Technology
3M: -1.57%
1M: -3.17%
$140.32
+1.3%
XLF
Financials
3M: -5.63%
1M: -3.77%
$50.98
+0.49%
Strategy Transparency
Methodology
This dashboard implements a Relative Rotation Graph (RRG) methodology. It plots sectors based on their relative strength (RS) versus the market benchmark (SPY).
- Leading Strong uptrend & outperforming SPY. The ideal place for long positions.
- Weakening Still outperforming, but momentum is fading. Often a signal to take profits.
- Lagging Weak trend & underperforming. Avoid these sectors.
- Improving Momentum is picking up, although still negative vs SPY. Good for "bottom fishing".
Strengths & Weaknesses
Why it
works
- Defensive: Naturally rotates out of crashing sectors (like Tech in '22).
- Tactical Alpha: The 1M Signal (Top Pick) historically outperforms SPY by reacting faster to new trends.
Risks
- Bull Market Drag: In a strong "everything rally", rotation strategies often lag buy-and-hold.
- Whipsaw: False breakouts in "Improving" sectors can lead to losses if the trend fails.