It was the best of times, it was the worst of times. During the month of October, the technology and financial sectors took two divergent paths. Financials rose 1.81% while technology fell 6.81%. As shown in our trading range charts of the two sectors below, the financial sector remains above its 50-day moving average and in a nice uptrend. The Technology sector is in extreme oversold territory at more than two standard deviations below its 50-day.
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You can see the divergent paths between tech and financials in relative strength charts (vs. the S&P 500) as well. As shown, aside from a brief bounce during the summer, tech has now been underperforming the overall market significantly since the end of the first quarter. The financial sector has been outperforming for a large majority of the year.