Chart of the Day - Monday, November 25, 2024

Patrick Dunuwila
November 25, 2024

Chart of the Day


🏆 Today's Chart of the Day was shared by Ian McMillan (@the_chart_life). 
 

  • There has been a notable rotation since the election. Mega-Cap Tech has lagged, while Small-Caps have surged. The chart shows the Nasdaq 100 Next Gen ETF ($QQQJ) versus the traditional Nasdaq 100 ETF ($QQQ).
     
  • While $QQQ represents the 100 largest stocks in the Nasdaq Composite, $QQQJ represents the 'next-100.' In other words, the 101st to the 200th largest stocks in the Nasdaq Composite. 
     
  • Ian points out that this ratio ($QQQJ/$QQQ) reclaimed horizontal support and its 200-day moving average today. Further upside from this ratio means alpha for Small and Mid-Caps in the coming weeks. 
     

The Takeaway: The Nasdaq 100 Next Gen ETF ($QQQJ) is trying to establish a bottom relative to the Nasdaq 100 ETF ($QQQ). This ratio signifies the ongoing rotation into Small and Mid-Caps. Today's breakout opens the door for further rotation in the coming weeks. 

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