Sector Relative Strength Report - October 19, 2020

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As earnings season deepens, it's worth remembering that credit spreads have narrowed significantly since March, and with that, volatility (VIX) appears to have completed three successively lower rounds of consolidation. We can estimate a floor on the crowd's speculative impulse at approximately $25/share for the VIX, with greater potential for volatility spikes up than down from here.  

With this macro activity, there is an attendant increase in sector rotation outside of Consumer Discretionary and Information Technology sectors. Within both of these two, there is a narrowing of variance in RS readings over the last 30 days, or a leveling of participation within each sector.