From Tech to the Old Economy: The Rotation Is Reshaping the Face of the US Market
The summer closing Trading Room focused on three themes set to remain central heading into September: the leadership shift towards financials, industrials and energy, the use of Gamma Exposure to read market accelerations, and the search for selective opportunities in equities and industrial metals.
A rotation that is now structural, no longer a simple tactical rotation
The Multiday Trading Room of 27 July opened with a reading as straightforward as it was decisive: the US market is not merely alternating sector leadership on a temporary basis, but appears to have initiated a deeper rotation in leadership.
The composition of the Dow Jones Industrial Average, more evenly balanced across sectors than the Nasdaq and less concentrated on technology than the S&P 500, offers an effective lens through which to observe the phenomenon. On the rotational map, several technology stocks have slipped into the weakness quadrants, while the bulk of relative strength has shifted towards financials, industrials, energy and healthcare.
The same reading is confirmed by the US sector map: energy, industrials, financials, utilities, real estate and healthcare are positioned in the more robust areas, while communication services and consumer discretionary show a less favourable trajectory. The result is a market that continues to hold up, but struggles to generate uniform momentum when the large growth segments lose steam.
Sector selection is not an ancillary step: a sound setup placed within a sector that is losing strength can tie up capital for weeks, reducing the portfolio's overall return.
This is precisely the operational value of the rotational grid: compressing the reading of many charts into a single screen and quickly distinguishing between sectors in leadership, areas in transition, and segments where the timing is still premature.
Energy: relative strength, but with non-ordinary volatility
The energy sector displayed one of the most readable patterns of the session: exit from the quadrant, sign of strength, brief pullback and subsequent resumption. The dynamic is consistent with a sector that, on a relative basis, is returning to a prominent position.
The underlying thesis extends well beyond oil alone. The expansion of data centres and computational workloads linked to artificial intelligence makes energy a structural theme, set to encompass nuclear, infrastructure and power generation as well. In the near term, however, the oil component remains exposed to exogenous volatility that is difficult to model, tied to the geopolitical tensions discussed during the webinar.
The operational implication is clear: a sector to monitor strategically, but to be approached on pullbacks, avoiding the chasing of already mature extensions. The rotational grid made it possible to isolate both stocks crossing into strength and names that had already entered a retracement phase following a bullish impulse.
Gamma Exposure: understanding when the market brakes and when it accelerates
The most educational segment of the Trading Room was dedicated to Gamma Exposure, or GEX, introduced as a new layer for reading market maker positioning in the options market.
I dealers act as counterparties to transactions and must dynamically hedge the risk arising from the positions they take on. Gamma measures the rate at which an option's delta changes as the underlying price moves. When this sensitivity increases, market makers' hedging activity can also become more aggressive.
The operational interpretation of GEX
The distinction becomes particularly useful on indices, where the breadth of the options market and the frequency of expiries make short-term positioning a potentially relevant indicator for multi-day swings. In the reading presented during the session, a negative GEX on the index signalled the possibility that a correction, once certain strikes were reached, could accelerate as a result of dealer hedging.
GoDaddy: Wyckoff, Dark Pools and gamma converge on the same structure
GoDaddy
GDDYThe stock offered the most complete case of the evening. On the weekly chart it displays a sideways range consistent with a Wyckoff reading, while the rotational framework shows improvement on both the short- and long-term timeframes.
- Structure: possible breakout from the consolidation zone, still to be confirmed by the weekly close.
- Volume: presence of a POC consistent with the technical levels observed.
- Smart money: significant Dark Pool transactions, with high rankings on the screen analysed.
- Gamma: positive exposure, with the area around $105 interpreted as a defensive level.
- Pullback risk: fair value gap area indicated lower down, around $82–82.50.
- Projection: the Wyckoff tool returned a theoretical extension of approximately $55, contingent on confirmation of the structure.
The conclusion was not to chase the stock immediately. The correct approach is to wait for confirmation of the breakout, observe acceptance above the structure, and use any retracement to improve the risk-to-reward ratio.
Nickel, aluminium and industrial metals ETFs: the second pullback under observation
The operational segment closed with a focus on industrial commodities. Nickel presents a less straightforward structure: the price could still produce an inducement move and stop hunt before developing a new leg higher, without necessarily fully covering the underlying gap.
Aluminium appears more directional. The POC area and the prior intermediate base represent the technical levels to monitor in order to assess whether the retracement may translate into fresh demand.
Also of interest is the industrial metals ETF EIMT, observed in what may be a second pullback within the consolidation range. The seasonality data presented during the webinar suggests a favourable window that may extend indicatively through to November, albeit with a dynamic articulated across multiple phases of acceleration and consolidation.
Automated scanners and pre-setups: the platform broadens the selection process
The final part of the session previewed several platform developments planned for the resumption of activities. The work in progress aims to integrate smart money, seasonality, price structures, fundamentals and news.
A visual scanner for Japanese candlestick patterns was also demonstrated, capable of scanning entire markets and signalling how many days prior a given pattern occurred. The next objective is to introduce automatic pre-setups, built from the configurations deemed most profitable, in order to reduce noise and focus the analysis on an already filtered watchlist.
The Trading Room will resume on 31 August. Among the topics announced for September are educational sessions dedicated to the new tools and a dedicated deep-dive on Gamma Exposure.
The market is not standing still: it is changing its engine
The evening's final reading is consistent: the weakness of major technology names does not automatically imply the end of the bull market, but signals that leadership is rotating. Financials, industrials, energy and healthcare are absorbing a growing share of relative strength, while the options microstructure adds a new instrument for assessing the pace of moves.
In such an environment, discipline does not consist in finding more ideas, but in filtering more effectively: sector first, then structure, then flows, and finally timing. This is the approach that allows one to avoid tied-up capital and to distinguish between a merely interesting chart and a genuinely mature setup.