Don’t Trust the Rally: Why Tech’s Real and Discretionary’s a Mirage

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Today’s price action looks bullish on the surface – consumer discretionary and tech are both up big. But don’t take that at face value.

That’s because I think today’s rally may be more illusion than confirmation. Like I said, consumer discretionaries, (as tracked by XLY) are ripping, but take a closer look and you find nearly half that move is just Tesla (TSLA) dragging the whole ETF behind it. That’s not a real read on consumer strength. Zoom out and you find durable goods are still slumping – and consumer confidence is questionable at best. And while Amazon (AMZN) represents legit spending, the stock is stuck under resistance.

Tech, on the other hand, is the real deal right now. The sector ETF, XLK, is pressing a breakout, and names like Microsoft (MSFT), Broadcom (AVGO), and CrowdStrike (CRWD) are setting up for honest-to-goodness continuation. If you want to trade momentum, that’s your lane.

In tonight’s video, we’ll look at how to fade the fakes and lean into strength. Let’s take a look at my charts…

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