The foundation in today's analysis is simply a comparison of the three-month price change with the six-month price change, on a sector-by-sector basis. The intent is to find the highest relative strength or the highest relative weakness. There are really only two possible verdicts using this type of framework. The first possibility is that the last three months worth of change is consistent with six month change. In this case, the trend is likely to be a long-term trend, and should be traded accordingly. The second possibility is that the three month price change moved in the opposite direction as the six month change. In this case, we're seeing a shift in momentum and relative strength. Although the three month change may be minimal, it may also mark the beginning of a new sector trend. The best part is, this idea can apply to short-term as well as long-term trades.

The results below of our analysis will clarify all of this. The sectors are ranked by their performance over the last three months (best to worst). The six month performance is listed in the other column. The lines in orange are the consistently problematic sectors. Here, the short-term trend flowed in the same direction is the bigger six month trend - both to the downside. The lines in yellow represent sectors that have a shot at a breakout soon. Although they may have done well recently, the bigger six month trend may only be positive because of gains in the last three months. The lines in green indicate consistent leaders. These are just industries that have had positive performance in the last three months inside an even more-positive six month uptrend. That's a hint of sheer strength. Take a look at the chart, then read on after that for our thoughts on each group.

Sector Relative Strength - ranked by three month performance

Consistent Leaders (green): Clearly there's been a shift into the defensive sectors over the last three months (and six months, for that matter) into the most defensive names. Healthcare has been the place to be, while energy has also been rewarding, despite the recent ease in gas prices. The thing is, the three month performance is just a small slice of a bigger six month trend. In other words, this isn't unusual.....it's just consistent. Humana (HUM), Option Care (OPTN), and McKesson (MCK) are just a few of the names that we liked in this sector well enough to own in the Multi-Cap Growth Portfolio. As for energy, Valero (VLO) and Knightsbridge Tanker (VLCCF) been red hot lately as well. We own them in the Multi-Cap too. In fact, our Multi-Cap Portfolio right now is overweighted in healthcare (with a 19% allocation) and energy (a 25% allocation) because of this same study we did back in late January, and it was a very profitable decision.

Who would have thought utilities was the place to be as we ended last year? Well, that same January study told us this was going to be the case. The utilities stocks were the third highest ranking sector then. The consumer non-cyclicals were ranked second. Capital goods were rated the top performer back in January, and even though the capital goods have been the weakest since then, clearly it would have paid big dividends (or at least avoided a lot of headaches) if this same study had been applied over the course of the last three months; all of those sectors have performed while very few of the other sectors have. To review January's rankings, click here. You can see how that January data would have steered you in the right direction

Going forward, besides healthcare and energy, the non-cyclicals (consumer staples) stocks look like they have the most to offer investors. These names include Procter & Gamble (PG) and Gillette (G), which P&G is buying soon.

Sectors in Transition (yellow): These are the companies that have short-term trends (three months) that are moving in the opposite direction of the longer-term trend (six months). The transition can be a bullish or a bearish one, but in this case, they all seem to be bearish. Six of the major sectors are down for the last three months despite being up for the last six months. The exception is the transportation stocks, which is barely down for both timeframes. We included it as a 'transitional', since the losses have been negligible so far. In all cases except the capital goods, the dismal three month performance has actually wiped away the majority of the gains made over the last half-year.

The jury is still out on these sectors, so to speak - they're not exactly good or bad. They could recover, but the momentum is to the downside now. We highlight them in yellow just as a way of telling readers to use caution, and think about whether or not the best days of these gains are behind them.

Consistent Laggards (orange): We're not surprised to see technology as the worst of the worst. It took the bottom spot last time too, and those who chose to fight the short-term and well as the long-term trend by buying then have come to regret it. The consumer cyclicals are a new entry into the laggard list, but with the economy now slowing down, this isn't really a surprise either. This group includes the auto-makers, which includes Ford (F) and General Motors (GM), both of which have had a downright painful year so far. You probably know that this industry is mired in problems right now, and there's not much that's going to change that soon. Like last time, your odds are better by betting against these sectors right now.

So, that's it - a quick glance at what the near and possible not-so-near future holds. Are your holdings fighting the current trend, or are they aligned with it? It's been said that 50 percent of a stock's movement can be attributed to the sector it's in. Are you giving yourself every advantage to make gains, or are you going against the grain? As you cancould tell from the January study, it's worth knowing. We'll revisit this chart again when we see some significant changes.

Price Headley is the founder and chief analyst of BigTrends.com.