One bad trading day couldnt keep the Nasdaq down.
The tech-heavy index bounced almost 50 points yesterday, erasing some of the losses from its big move lower this week.
Just a day removed from the FANG meltdown, the financial noise machine has moved on to celebrate Dow 24,000 and the Big Boards longest streak of monthly gains in more than 20 years.
All is right with the world. Weve managed to survive another one-day bear market. Break out the bubbly!
Yesterdays action goes to show that investors are rarely rewarded for quickly flipping bearish during a roaring bull market. The big tech stocks might be taking a break. But that doesnt mean every other sector on the market is headed lower.
In fact, the Nasdaqs slump has helped uncover a couple of new setups that could turn into incredibly lucrative trades heading into 2018. As you saw yesterday, its time for us to look beyond the FANGs and find the trades no one else is talking about
We already showed you how the SPDR S&P Retail ETF (NYSE:XRT) is breaking out of its funk. While Amazon shares chill out, the retail sector is suddenly becoming a new market leader during the busy holiday shopping season. Dead malls are coming back to life and throwing off gains once again.
The brick and mortar retail comeback isnt the only market rotation were witnessing this holiday season. Theres another major breakout popping up in one of the markets most important (and overlooked) sectors
Im talking about transportation stocks.
Transportation stocks like airlines, freight, and delivery names werent exactly setting the world on fire earlier this year. Transportation stocks went nowhere for the first eight months of 2017. Thats not an exaggeration. The Dow Jones Transportation Average topped out on the first day of March. This false breakout led to a swift move lower. Just a few weeks later and these stocks were dangerously close to correction territory.
A quick comeback saved the sector from disaster. But the group wasnt ready for prime time just yet. By the end of August, the transports were flat on the year even as the major averages jumped to double-digit gains.
Its no secret that these stocks have been absolute dogs for months. But as the markets melt-up mode shifts into overdrive this holiday season, these sickly transports are starting to outperform the major averages in a big way…