Can You Guess How Much Meta Is Up This Quarter? How About Apple?
If you knew the answer on July 1st, you'd probably not have believed it.
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If I had told you on July 1st, the beginning of the second quarter, that Meta would be flat on the quarter and Apple would be up 25% you’d have laughed at me.
You probably would have laughed at me if I had told you on that same date that the QQQs would be up ten percent in the quarter and XME would be up 35%.
I have talked about the group rotation in the market, and I have touched on the fact that the Mag 7, whatever their names are these days, have become rather ordinary stocks. Sure, a move in one of the mega caps still pushes the indexes around like a leaf in a strong wind, but overall their outperformance waned in the third quarter.
The ratio of XME to the QQQs since May has been a one-way street, but the move in the months of August and September has been nothing short of spectacular. Let me say I don’t think it’s sustainable, as a correction is highly likely, but that is something to behold.
I know you’re thinking this is the move in gold and silver. But in the top ten holdings of XME there are only three precious metals and none of them are the first two. In fact it is a pretty diverse list, although it is top heavy as all ETFs are.
MP Materials tops the list followed by Uranium Energy. There is even a steel company in there and a coal company. I was quite surprised to discover Freeport McMoRan is not in the top ten holdings. I mean they are metal and mining, aren’t they?
As we head into the week I must report once again that the indicators did not change after Friday’s rally. There is one chart I like to watch that rarely says anything, as it tends to stay within the accepted range. But the ratio of insider selling to buying has surged.
Lately I have heard many folks talk about the lack of insider buying (I do not know if this includes Elon Musk’s buy of Tesla or if that will find its way into the statistics next week) but it never seemed to show up in this chart. While the ratio did not get into ‘bullish’ territory as it did last spring, it didn’t really spike much this summer. But now, it has surged and it is (if you squint really hard) just over where it was in January.
I have noted before there is no timing to this indicator but rarely have I seen it get this high that we haven’t then had a worthy correction in the next few months.
I look forward to the rationalizations about how people only buy for one reason (they think the stock is going up) but sell for a variety of reasons. I prefer not to rationalize an indicator.
