Despite hitting all time highs this week, under the hood the market is in pretty rough shape and being mostly propped up by a handful of big tech stocks as we head into the heart of earnings season.
We're seeing the value/energy/commodity sector sell off bigly the last week or so, including another big down day in many stocks across commodities.
All in all it's really been a tough week outside the big tech companies and even then seem to be cooling off today a bit.
Just wondering how the exchange is looking at these moves. Just a stalling of the value trade that will kick back in once we get out of the summer doldrums? Or much more pain to be felt as the big tech stocks continue to outperform? Or will it just be a big market drop in the coming weeks as we head into August and the momentum peters out and overbought big cap stocks sell off and bring the whole market down?
For me its tough to see my core long-term holdings in energy, PMs & commodities get hit really hard day in day out. I really am a believer in the commodity inflation thesis, so am holding the course and nibbling on some of these stocks (e.g. bought a little BTU, NGD, PBF and WDOFF on weakness today) but hard to have conviction here at least in the short-term. Still I'm not selling as I firmly believe in the longer-term (i.e. next 3-5 year) commodity boom.
I'm also wary of staying involved in the big cap tech companies for much longer here. Not that I was really in too many at this point anyway (just options earnings plays on APPL, TWLO and AMZN). And staying away from crypto for now.
So I'm generally being more cautious, day-trading more and looking to stay more in cash in the next few weeks expecting a market garden-variety selloff. But boy this value selloff is really hurting my long-term portfolio, and not seeing any end in sight for now, especially if we get to more risk-off in the next few weeks, market rolls over a bit, rates drop etc.
Just wondering if anyone is getting longer value / pms here or are we all mostly following the general consensus and being a bit more careful right now?