Good Morning, Traders. For the second day in a row, the major averages closed divergently with relative weakness in the Nasdaq that kept the tech index underwater while the Dow gained slightly and the S&P closed flat. It's relatively rare when this happens period, but even moreso when its two consecutive days in a row. We are showcasing the weekly Nasdaq Composite in the chart below to illustrate the recent double top and how it differs from the S&P and Dow weeklies, which closed much stronger and either above (Dow) or just at (S&P) prior 2006 highs. Pull up weeklies of the other two and compare to see this clearly. Bulls are continuing to favor energy and metals over tech in this current upswing. If you are at all confused about how to position trade or invest for the longer term, then that last sentence should have leaped off the page at you and turned on a light bulb in your mind. Watching how sectors and stocks react in strong and weak markets and determining if they are exhibiting relative strength or weakness is probably one of the best skills that you can have to help determine where to put your investment dollars to work.

Peter Reznicek is the Chief Equity Strategist and a principal of the Prana Fund, a domestic hedge fund, and ShadowTrader, a subsidiary of thinkorswim which provides coaching and education to its clients on both intraday and swing trading of equities. For a free trial to the full version of The Big Picture or to learn about ShadowTrader's other services, visit shadowtrader.net or send an email to preznicek@shadowtrader.net.