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Over the past couple of weeks here in Sector Leader Bullseye, I’ve been ringing the alarm surrounding the flow of capital into defensive segments of the market.

In fact, I felt so strongly about it that I was compelled to do a special session on Wednesday on the cautionary rotations taking place underneath the surface of the market. 

One of my big concerns right now is that the Fed is late to the rate cut party. We saw the Bank of England cut rates 25-basis points this week, but the even bigger surprise was the Bank of Japan, which finally put an end to NIRP (Negative Interest Rate Policy).

The problem now is that the risk-off capital flows are accelerating, and I think we could be in for some real turbulence in the weeks ahead. Check this out…

My Risk Dashboard Is Clear: Risk-Off
 

Have a look at my sector leadership table as of last Friday’s close. As you can see, the strongest sectors as of late have been the defensive ones, which are highlighted in red.

Note how this trend really began to accelerate over the last four weeks or so. This table helped me pick up some of the defensive capital flows and alert you to the downside risks in the market.

And it’s not just defensive sector trends that I’m seeing. Bonds are starting to outperform stocks, which is a classical risk-off signal as well. 

Even though we could be heading into some rough waters here, I’m even more excited about the opportunities that will follow afterwards. I’ll keep you posted along the way,

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