Today’s report will focus on the two software ETFs and Adobe, a software stock that could be turning the corner. Software is in focus because this group is showing leadership since June. For example, the Software SPDR (XSW) is up 25% since June, while the Semiconductor SPDR (XSD) is down 24%. Semiconductors, however, are outperforming software when we go back to April and include the massive surge in April-May. Perhaps semis will come back, but right now software shows relative and absolute strength. $IGV $XSW $ADBE

Tech leadership is slipping as semiconductors break down and the AI trade unravels in October. XLK and QQQ remain well above their rising 200-day SMAs, which suggests they are still in long-term uptrends. However, both produced outsized declines in October and their September breakouts failed. Outsized declines are sudden and sharp declines that can derail an uptrend. $QQQ $QQEW $SPY $MAGS $XLK $AIQ $ARTY $SMH $DRAM $SOXX $SKYY $CIBR $IGV

SPY and QQQ are still in long-term uptrends, but the market is having a rethink here in October. After leading for most of 2026, the Technology SPDR and QQQ are lagging in October as they fell sharply the last six days. Moreover, both fell sharpy after hitting new highs and such declines can derail an uptrend. Elsewhere, the junk end of the stock market is bearing the brunt of selling pressure with the Russell 2000 and Russell Microcap ETFs leading the way lower. Breadth Thrust setups were brewing in early October, but the actual thrust signals failed to materialize. $IJR $IJR $IWM $IWC $XLK $QQQ $QQEW $SMH $SOXX $DRAM

Today’s report will dive into the industrials sector. Frist, the Industrials SPDR is setting up as it corrected to a Bullish Setup Zone and firmed. Second, the top 11 component stocks are mixed with four sporting recent breakouts. Attention then turns to the Aerospace & Defense ETF and Clean Edge Green Energy ETF as both hit Bullish Setup Zones. $XLI $ITA $QCLN

Today’s report will dive into the Healthcare sector, which is one of the best performing sectors over the last one, three and six months. The Healthcare SPDR formed a small bullish continuation pattern and broke out. Ten of the top eleven stocks are above their 200-day SMAs with AbbVie leading. We then turns to the corrective patterns in the biotech ETFs, the breakout in the Medical Devices ETF and the upturn in the Healthcare Providers ETF. $XLV $IBB $XBI $IHI $IHF

Large-caps, tech and hyper-scalers are leading the market as SPY, QQQ, the Technology SPDR, and Mag7 ETF all hit new highs in October. Small-caps and mid-caps are lagging as they fell to their rising 200-day SMAs, but show signs of short-term upturns over the past week. Last week I showed thrust indicators setting up (Zweig Breadth Thrust and %Above 50-day SMA). These have yet to trigger, but I will watch closely in the coming days/weeks. $SPY $QQQ $IJR $IJH $XLK $MAGS $AIQ $ARTY $IYZ $SMH $SOXX $DRAM $BLOK $IGV $CIBR $SKYY

The strength we are seeing here in early October started in early August when SPY, QQQ and several tech-related ETFs broke out with surges. These same ETFs corrected again in September, but held their early August breakout zones. Moreover, they broke out again in the second half of September. These breakouts keep the bigger August breakouts alive. SPY, QQQ, XLK and MAGS hit new highs in October because they are following through on prior breakouts. $SPY $QQQ $XLK $MAGS $IJR $IJH $AIQ $ARTY $SMH $SOXX $DRAM $VOLT $IYZ $BLOK

There was a lot of selling pressure in September as downside participation hit an extreme. Selling pressure was concentrated in the Equal-weight S&P 500 (RSP), Small-caps (IJR) and Mid-caps (IJH). These oversold extremes could give way to an about face and bull stampede. It hasn’t happen yet, but this possibility should be on our radar as we enter the fourth quarter. $SPY $NYA $SPXA50R $SPXADP

Healthcare related ETFs are leading the market since June. QQQ and XLK peaked in June, fell into July and recovered with gains into September. Both are still just below their June highs. In the meantime, money moved into healthcare-related ETFs with the Healthcare SPDR and Biotech ETFs gaining over 15% since June. Healthcare is the strongest sector since June and the second strongest sector since May. It is also the fourth biggest sector in the S&P 500 (9.36%). $XLV $IBB $XBI $SBIO $IHI $IHF

The broader market was hit rather hard in September as macro headwinds swirled. These headwinds, however, did not affect QQQ, the tech sector and the healthcare sector. Strength in these two sectors is propping up SPY, which is down a fraction month-to-date (-.19%). It is hard to have a bear market when SPY is above its 200-day and tech is leading. Today’s report will focus on the headwinds, key levels for the leaders and an alternative interpretation of the SMH chart. $SPY $QQQ $XLK $MAGS $AIQ $ARTY $SMH $SOXX $DRAM