Last week saw a wide divergence in the stock market. Sectors that exploded higher after March 2020 (e.g. tech, IPOs, growth stocks) saw sharp drawdowns while sectors that lagged significantly (e.g. energy & finance) are catching up.

What a week it has been! Various markets saw noticeable declines on news of rising yields. The strong upward trend for stocks is finally taking a long-overdue breather and so is extreme sentiment.

The market’s strong uptrend remains intact despite some lingering concerns about high valuations, extreme sentiment, and other overbought signals. Investors continue to pour into all markets with ever increasing liquidity.

This bull market is unique because unlike past bull markets, this one began with extreme speculation. Historically, extreme speculation occurred at the end of multi-year bull markets.

Last week’s market volatility was followed by a sharp reversal higher. While various speculative concerns remain (record valuations, frothy sentiment etc), the stock market’s uptrend remains intact for now.

Reddit & retail traders caught the world’s attention, stocks fell, hedge funds blew up, etc. Here’s what matters underneath an ocean of noise.