As The Market Churns

Image Source: Stocks managed to grind their way higher on the day, while rates and the dollar rebounded from yesterday’s declines. The price action in the stock market has been strange, and I can only attribute that to some internal rotation. Yesterday, small caps and the S&P 500’s equal weight were strong. Today, these parts of the market were weak while the headline S&P 500 was up.But the funny thing is that the indexes are all up the same amount after two days.The one thing that seems clear is that something is bound to break here because when you look at the relative to the , it is not a chart that inspires confidence. It looks like the double top pattern mixed with a head-and-shoulder, and that can’t be a good mix.The SMH to looks the same.The to ratio has a similar feel.The QQQ to ratio has already broken down.As does the QQQ to .It almost feels like the market keeps rotating around, keeping this ratio afloat. The to has already broken down, though it could use more follow-through.While the to won’t budge.You could see why it may be the case, for example, if someone were long tech and short small caps. Or whatever. Given the herd mentality, plenty of these trades are likely going on. The only question is whether or not something comes along to force that trade to unwind. I do not know.It is a frustrating market for anyone who isn’t invested in an S&P 500 index fund because this endless rotation only seems to push the S&P 500 higher while everything else just churns.More By This Author:Rates, Dollar, And Nvidia Drop Sharply On November 25, 2025The Fed Rate Cutting Cycle May Be OverHigher Rates And A Stronger Dollar May Significantly Tighten Financial Conditions