Systematic Trading Strategies and Next Level Trading Setups

Cracks within Tech – Bonds Outperform Bitcoin – Insurance Names Catch Strong Bid

Cracks within Tech – Bonds Outperform Bitcoin – Insurance Names Catch Strong Bid

Welcome to the Friday Chart Fix!

The market shows more signs of risk aversion with breakdowns in technology-related ETFs, strength in insurance and bonds, and a downtrend signal in Bitcoin. The Semiconductor ETF is holding up, but the Software ETF and ARK Innovation ETF are breaking down. Money is rotating from these areas to insurance stocks, which produced several bullish Trend Composite signals this week. Traders are also selling Bitcoin as it reversed a one year uptrend and started underperforming the Treasury bond ETF.

  • Cracks within Technology (ARKK, IGV)
  • Trend Consensus with the Trend Composite (NVDA)
  • Uptrend Signals in Insurance Names
  • Bitcoin ETF Triggers Downtrend Signal
  • Bonds Outperforming Bitcoin (IEF, IBIT)

Recent Reports and Videos for Premium Members

Cracks within Technology (ARKK, IGV)

Cracks are appearing in the tech sector as the ARK Innovation ETF (ARKK) and Software ETF (IGV) break their lows from October 10th. Stocks fell sharply on October 10th with the Technology SPDR (XLK) losing 4%. XLK then rebounded into late October with a new high on October 29th (blue arrows). The Semiconductor ETF (SMH) followed suit with a new high as well. As the chart below shows, both XLK and SMH are still above their October 10th lows (as of Thursday’s close).

The October 10th lows mark benchmark lows chartists can use to compare performance. Names holding above these lows show relative strength, while names breaking below these lows show relative weakness (and absolute weakness). While SMH is holding up, the Software ETF (IGV) is not and leading the way lower. The bottom window shows IGV failing to record a new high in late October and breaking its October 10th low (blue line). The ARK Innovation ETF (ARKK), which represents the most speculative tech stocks, it also lagging as it broke the October 10th low.

Semiconductor stocks account for 38.35% of the Technology SPDR (XLK), which makes this the largest group in XLK. Software, however, is not far behind with a 33.4% weighting.

Looking for indicators with an edge? Check out the TIP Indicator-Edge Plugin for StockCharts ACP. Click here to learn more.

Trend Consensus with the Trend Composite (NVDA)

In an effort to reduce whipsaws and find consensus, I created the Trend Composite for trend-following signals. This indicator defines the consensus by aggregating signals from five trend-following indicators. These include Bollinger Bands, Keltner Channels, StochClose, Moving Average Trend and CCI-Close with 125-day timeframes. This indicator is one of eleven in the TIP Indicator Edge Plugin for StockCharts ACP.

An uptrend signals when the indicator turns positive, which means the majority of indicators signal an uptrend. A downtrend signals when the indicator turns negative. The Trend Composite ranges from +5 to -5 and is always an odd number. A reading of +3 means four indicators are bullish and one is bearish (4 – 1 = 3).

The chart below shows Nvidia (NVDA) with the Trend Composite in the first indicator window and the other indicators. Currently, all five indicators signal uptrend (Trend Composite = +5). 

Uptrend Signals in Insurance Names

TrendInvestorPro tracks Trend Composite signals for S&P 500 stocks on a weekly basis (Saturday updates). One group stood out while analyzing this week’s signals: Insurance. Note that Healthcare stocks were dominant over the last six weeks with 19 uptrend signals.

Insurance stocks triggering uptrend signals this week include Allstate (ALL), Berkshire (BRK/B), Chubb (CB), Hartford (HIG), Prudential (PRU) and MetLife (MET). The S&P GICS methodology lists Berkshire as a consumer non-cyclical, which explains why it is not part of the Insurance ETF (KIE). However, in a CNBC interview last year, Warren Buffet noted that insurance is the most important business at Berkshire.

The chart above shows Berkshire with the Trend Composite turning positive this week (+3). This bullish trend signals coincides with a triangle breakout and break above the September high. Also note that the S&P 500 is down around 1.5% so far this month and Berkshire is up 7.5%.

Trend-following indicators lag, which means they will never catch a top or bottom. These indicators signal when a move is strong enough to reverse the prior trend. Not all signals work, but some lead to extended trends that more-than-pay for the poor signals. For Berkshire, the Trend Composite turned positive in mid November 2022 and stayed positive until mid July 2025, which price rising from 310 to 470.

Bitcoin ETF Triggers Downtrend Signal

The next chart shows the Bitcoin ETF (IBIT) with the Trend Composite turning negative on November 4th. This downtrend signal reverses a bullish signal from mid October 2024. IBIT gained around 45% from mid October 2024 to early November 2025.

Trend Composite signals can also be used as a filter to separate uptrends from downtrends. Once an uptrend signals, chartists can put these names on a watch list and wait for tradable pullbacks and bullish setups to emerge. For example, IBIT formed a falling wedge into April and broke out with a surge in late April. This correction occurred within a long-term uptrend as the Trend Composite remained positive.

Bonds Outperforming Bitcoin (IEF, IBIT)

The 7-10Yr TBond ETF (IEF) is not the most exciting trade out there, but this bond ETF is in an uptrend and outperforming the Bitcoin ETF. The chart below shows the Trend Composite turning positive in early April and IEF trending higher the last six plus months. In the lower window, we have the price-relative (IEF/IBIT ratio), which measures relative performance. IEF underperformed IBIT from April to early October as the price-relative fell. This relative performance line turned up in October and recorded a five month high in early November. This means Treasury bonds (safe-haven assets) are outperforming Bitcoin (risk asset). Trade accordingly!

See the Premium Page for more chart analysis and videos.

Recent Reports and Videos for Premium Members

Gold/Silver Surge from Oversold Levels – Bond/Uranium ETFs Set Up – Bitcoin Lags with Downtrend

By

Precious metals continue to lead the pack with the Silver ETF (SLV) sporting the biggest gain over the last three months (+40%). Industrial metals are also outperforming stocks with the Copper ETF (CPER) and DB Base Metals ETF (DBB) up over 10%. QQQ is up a measly 7%. Even bonds are up with TLT gaining 3.65% and

Gold/Silver Surge from Oversold Levels – Bond/Uranium ETFs Set Up – Bitcoin Lags with Downtrend Read More »

Some Warning Signs, but Tech ETFs Still Leading – As are Utes, Industrials, Healthcare

By

The weight of the evidence remains bullish for stocks, but there are large pockets of weakness within the market. 56.6% of S&P 500 stocks are above their 200-day SMAs, which means 43.4% are below and in long-term downtrends. Even though this is a rather large swath of the market, the cup

Some Warning Signs, but Tech ETFs Still Leading – As are Utes, Industrials, Healthcare Read More »

Defensive Sector Stands Strong as Economically Sensitive Sector Breaks Down

By

Stock market performance remains mixed with a high percentage of S&P 500 stocks trading below their 200-day SMAs. This number has yet to exceed 50%, but should be watched because the Consumer Discretionary and Technology sectors show deterioration. Despite a mixed market, the Healthcare sector is rising above the

Defensive Sector Stands Strong as Economically Sensitive Sector Breaks Down Read More »

Gold, Silver and Bond ETFs Set Up – Meme ETF, Bitcoin and QQQ Correlation  

By

There are some interesting developments in the alternative ETF universe. Gold, silver and their respective miners corrected within leading uptrends. This means they are setting up bullish. Bonds got clobbered the last six days, but TLT is also setting up bullish as it tests the prior breakout. The Bitcoin ETF hit a six month low to become

Gold, Silver and Bond ETFs Set Up – Meme ETF, Bitcoin and QQQ Correlation   Read More »

Bearish Shifts after Becoming Overbought (QQQ) – Key Levels for NDX Breadth (Part 2)

By

QQQ is looking overbought because it closed above the upper Bollinger Band (200,2) twice this week. As noted in Part 1, stocks and ETFs can become overbought and remain overbought in strong uptrends. This is why we need a momentum indicator to signal a bearish shift. This report will first show how to use StochRSI for momentum shifts and then identify the key levels for Nasdaq 100 breadth.

Bearish Shifts after Becoming Overbought (QQQ) – Key Levels for NDX Breadth (Part 2) Read More »

Gold Oversold – Base Metals Lead – Uranium Breakout – Bonds Fall, but Still in Uptrend

By

Gold, silver and their respective miners show the same chart characteristics: long-term uptrends, explosive moves from late August to mid October, sharp corrections the last eight days and short-term oversold conditions. We will start with the Gold SPDR (GLD) chart because gold is

Gold Oversold – Base Metals Lead – Uranium Breakout – Bonds Fall, but Still in Uptrend Read More »

Cadence CDNS, Tesla TSLA, Burlington BURL, Newmont NEM, Freeport McMoRan FCX

By

The market environment remains bullish with tech and AI related stocks leading the charge. Today’s report features a stock that fits in both the semiconductor and software groups (Cadence CDNS). We will also cover Tesla, which is part of the Mag7 ETF, another market leader. Attention then turns to an off-price retailer with a breakout (Burlington Stores BURL).

Cadence CDNS, Tesla TSLA, Burlington BURL, Newmont NEM, Freeport McMoRan FCX Read More »

Staying the Course – SPY/QQQ Hit New Highs – Tech/AI ETFs Lead – Flag/Pennant Breakouts

By

The weight of the evidence remains bullish with the same groups leading the way higher. SPY and QQQ hit new highs to affirm the dominance of large-caps and large-cap techs. Tech, industrials and utilities are the strongest sectors with new highs this month. Within technology, the AI-related ETFs are leading the charge with short-term breakouts last

Staying the Course – SPY/QQQ Hit New Highs – Tech/AI ETFs Lead – Flag/Pennant Breakouts Read More »

Bond ETF Hits New High – Gold Hit – GDX Triggers Stop – Moment of truth for Bitcoin

By

Today’s report starts with bonds because these safe haven assets are trending higher. Bonds have yet to start outperforming stocks, but traders should watch this relationship for clues on the risk appetite for stocks. Precious metals were rocked this week as gold, silver and their respective

Bond ETF Hits New High – Gold Hit – GDX Triggers Stop – Moment of truth for Bitcoin Read More »

Two Leading Cybersecurity Stocks – A Reversal within Aerospace – Housing Holds 200-day

By

Today’s report features five stock setups and two ETFs. Finding setups during earnings season is a challenge because I try to avoid stocks that are reporting within the next two weeks, and most stocks in the S&P 500 are reporting between now and month end. I am revisiting three prior

Two Leading Cybersecurity Stocks – A Reversal within Aerospace – Housing Holds 200-day Read More »

Gold/Silver Miners Extend Again – URA Ignores Physical Uranium – IBIT Holds Breakout Zone

By

Metals have been leading the financial markets with massive moves the eleven weeks. SPY (+4%), QQQ (+6.6%) and IWM (+14.10%) sport nice gains since August 1st. These gains, however, are dwarfed by Silver Miners SIL (+65%), Gold Miners GDX (+57.77%), Uranium URA +47.64%) and Silver SLV (+45%). The Gold SPDR (GLD) is in the middle

Gold/Silver Miners Extend Again – URA Ignores Physical Uranium – IBIT Holds Breakout Zone Read More »

Scroll to Top