The Stealth Bear Market

The S&P 500 and NASDAQ are trading less than 5% from their all-time highs so it's all good for those who own stocks? Well, maybe if you own index funds or ETFs like SPY and QQQ.

But, even if you own SPY in a way you are long a small number of stocks because over the last six months, MSFT, AAPL, NVDA, and GOOGL have generated almost 70% of the S&P 500's returns. 

And what if you own a sector, industry, or country ETF? Or one of Cathie Wood's ARK Funds?

Here's how ARKK (ARK Innovation), FXI (China Large-Cap), AWAY (Travel Tech), BJK (Gaming) stack up when compared to the NASDAQ and S&P 500 year to date...

It could be even worse if you held on to some popular stocks from the beginning of this year...

I think you get the idea. While the "market" as represented by the NASDAQ and S&P 500 trade near all-time highs the market "breadth" continues to deteriorate.

Here's what I'm talking about...

Check out yesterday's data on new highs vs. new lows across different periods of time. It's 3 to 1 when it comes to stocks making new year-to-date lows vs. year-to-date highs...

And 60% of stocks are trading below the 200-day moving average. Some bull market...

Under the surface, there has been a massive correction going on. A "stealth" bear market.

But bear markets create opportunity. And with so many stocks down 30% or more, there will be some incredible opportunities for those that know where to look.

Right now is a great time to start sifting through some of the beaten down and forgotten about industries.

What's on your watchlist?

SIGN UP HERE to receive Profit From Trends directly to your inbox once a week.