Trend Signal Now: Selling in US Growth Continues

Thursday, March 13, 2025

The selling in US Growth stocks continues.

But why have European stocks and China done so well?

They don't have any US Growth stocks in their indexes.

While the selling pressure in these stocks has accelerated recently, the underperformance has been there since last summer. We've been pointing out that High Beta never broke out relative to Low Volatility stocks while the major indexes were making new highs.

And now they're making new lows. Look at the underperformance from Tech along with the underperformance in High Beta:

And I'll be the first to tell you that it affects me too. Remember, that on a personal level, my wife and I have retirement accounts and we have 3 kids with college funds. I'm not immune to the selling in US Growth stocks.

I'm right in there with you guys, regardless of what I do for my day job.

Now, this is a great example of why we don't want to limit ourselves to a long only strategy in U.S. stocks.

I've already got plenty of that stuff. Too much, if you ask me. So I need to go out of my way to find additional sources of income and returns.

This is strictly on a personal level, just as a father and leader of a household, not even for work purposes.

Now, I understand that many people come to ASC Research for this reason, but even if that wasn't the case, I would still be striving to find areas in the market that are working.

And it's not just Chinese and European stocks.

Look at Gold making new all-time highs. Also, you're really starting to see the Gold Mining stocks working as well as breadth expands to those areas.

Things are getting better for Gold investors, not worse:

The relative strength in Japan also looks interesting.

This ETF here $EWJ plays Japan priced in US Dollars. So the ETF does better in a weaker Dollar tape:

And then bringing it back to the U.S., I like keeping an eye on Amazon here.

This is the largest component of the Consumer Discretionary sector. If $AMZN loses those former highs from late 2021, then this becomes a bigger problem for the overall state of the market:

If this bull market has legs, $AMZN can't be collapsing.

So the ability for the buyers to come in and defend these levels will be crucial.

The consumer represents 70% of the U.S. economy. And I'm no economist, but I'll take the over on that.

Fortunately we have my friend Jeff Macke, who is the expert on all things retail and consumer to talk the current state of the consumer.

We went LIVE yesterday at the close to talk about which stocks to avoid here and the one trade he put on yesterday, from the long side.

Jeff is going shopping down here. Watch the replay now.

JC Parets, CMT | Founder, All Star Charts

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