Chart of the Day - Tuesday, January 4th, 2022

Today’s Chart of the Day was shared in a note by Brian Joyce of Nasdaq. It's a monthly chart of Growth vs. Value over the past 36 years. Growth outperformed Value for a record 5th consecutive year in 2021. The uptrend has been in place for more than 14 years now. Every year it seems we hear claims that Value will finally make a comeback, but that call has yet to materialize. Fighting trends can be a dangerous endeavor, however, Brian makes a solid argument that a reversal could be at hand. Brian explained, "The breakout in November has the potential to be what technicians refer to as a “false breakout,” which are often followed by sharp countertrend moves to the downside. Also, RSI has formed a bearish divergence, suggesting momentum is waning. It's still too early to call the death of Growth, and big ships take a long time to turn. But, one could certainly make a credible case, based on technicals, that Value's day in the sun is long overdue. Click here to read the full note.