The Ebb and Flow Between Growth and Cyclical stocks

BABA and NTES are timely again after their recent corrections

If you didn’t have a chance to join our FSInsight Virtual Conference on Thursday you can find the replay at this link (click here). My technical analysis presentation begins at 1:39:20 and at 1:48:10 I discuss the hotly debated topic of growth stocks versus value stocks.

While I expect cyclicals to outperform into Q1 and likely through 2021, I don’t believe growth stocks are establishing long-term tops as some market pundits have suggested. From my technical perspective, there simply is insufficient technical evidence to make that case. Sure, many growth are well advanced above their uptrends but many other growth stocks are working through orderly sideways trading ranges or consolidations. I view these types of pauses in uptrends as normal and healthy technical behavior. It is not unusual in bull markets for leading stocks to pause, consolidate and catch up to longer-term moving averages which is often near their 200-day averages. Bull markets are a type of relay race where leadership is often passed between a number of market leading groups.

Why is this relevant now? Well, after pulling back from their late summer and fall highs, a growing list of growth stocks are moving back to levels where I expect to see them begin to bottom and start rebounds. Incrementally, one by one, I am seeing a growing list of growth stocks starting to show evidence of bottoming intermediate-term. The bottom line is that while I expect cyclicals to outperform through 2021, it does not mean growth stocks aren’t also going to participate on the upside. In fact, I’m expecting leadership to ebb and flow between growth and cyclical stocks over the coming quarters and technical analysis will be one of the better financial tools to spot timely entry points in each theme.

checkout-thomas-lee image
checkout-logo image

Become a Member To Access FS Insight Research

FS Insight gives individual investors access to Tom Lee's research, previously only available to banks and hedge funds.

Monthly

$199/mo

Includes 30-Day Free Trial

Join Now

Annual

$2,388 $2,028/yr

Savings: $360

Join Now

What's included in your FSI Membership?

tom lee iamge

Thomas J. Lee

Head of Research

Type Publication Mon Tue Wed Thu Fri Monthly
Reports First Word
The best market research out there -- on a near-daily basis.
Intraday Alerts
These are released periodically after crucial market developments.
Real-Time
Weekly Roadmap
Weekly summary of market events and updates on our key theses.
Webinars & Videos Macro Minute Video
Daily video commentary on market conditions & key events.
Outlook Webinars
We host over 12 LIVE webinars per year with our research team and high-profile special guests. Incredible value and market insights!
Yearly
Granny Shots Webinars
CEO Interview Webinars Quarterly
Appearances Archive Real-Time
Allocation Tools "Super Granny" Shots Stock List
Granny Shots we expect to tactically outperform and underperform.
Granny Shots Stock List
Thematic investment stock picks that aim to outperform the S&P 500.
Sector Allocation
A sector allocation strategy that is designed to outperform the S&P 500 while taking minimal risk.
Market Alerts ⚡️FlashInsights
Real-time market commentary about macro and crypto events from our research heads.
Real-Time
tom lee iamge

Mark L. Newton

Head of Technical Strategy

Type Publication Mon Tue Wed Thu Fri Monthly
Reports Daily Technical Strategy
Daily commentary on market trends and short term opportunities.
Weekly Roadmap
Weekly summary of market events and updates on our key theses.
Webinars & Videos Daily Technical Strategy
Daily commentary on market trends and short term opportunities.
Live Technical Analysis
Outlook Webinars
We host over 12 LIVE webinars per year with our research team and high-profile special guests. Incredible value and market insights!
Yearly
Appearances Archive Real-Time
Allocation Tools Newton's Upticks Stock List
Technically derived, intermediate-term picks of attractive risk/reward opportunities from the S&P 500.
Market Alerts ⚡️FlashInsights
Real-time market commentary about macro and crypto events from our research heads.
tom lee iamge

L. Thomas Block

Washington Policy Strategy

Type Publication Mon Tue Wed Thu Fri Monthly
Reports US Policy
Weekly update on developments in Washington DC and how they may impact Wall Street.
Weekly Roadmap
Weekly summary of market events and updates on our key theses.
Market Alerts ⚡️FlashInsights
Real-time market commentary about macro and crypto events from our research heads.
Real-Time
sean farrell Crypto Team

Sean Farrell & Crypto Team

Type Publication Mon Tue Wed Thu Fri Monthly
Reports Market Update
Stay on top of the crypto markets with macro commentary, technical analysis, and the most relevant news.
Weekly Strategy
Weekly summary of market events and updates on our key theses.
Funding Fridays
Are you looking for investment opportunities in the crypto space? We explore early-stage crypto opportunities in this note about where the smart money is being invested!
Crypto Concepts
We periodically provide in-depth research on the leading protocols, companies, and funds shaping the crypto ecosystem.
Liquid Ventures
A recurring research note focused on delivering unique insights into high-risk investment opportunities within the crypto ecosystem, primarily centered on early-stage or small-cap tokens.
Deep Research
We periodically provide in-depth research on the leading protocols, companies, and funds shaping the crypto ecosystem.
Quarterly
Weekly Roadmap
Weekly summary of market events and updates on our key theses.
Webinars & Videos Outlook Webinars
Ongoing webinars exploring crypto opportunities, in depth research, and exclusive research offerings from our team of analysts and leading cryptocurrency firms.
Yearly
Crypto Comments Daily Technical Strategy
From Bitcoin, Ethereum and Solana to other coins, our Head of Technical Strategy highlights important price movement to help give you an edge.
Allocation Tools Crypto Core Strategy
A powerful tool designed to help crypto investors build a crypto portfolio that outperforms the industry’s king – bitcoin – regardless of market conditions.
Market Alerts ⚡️FlashInsights
Real-time market commentary about macro and crypto events from our research heads.
Real-Time
Crypto Team

FS Insight Research Team

Type Publication Mon Tue Wed Thu Fri Monthly
Reports First to Market
*Earnings Daily
This note provides investors with a myriad of useful metrics to measure the progress of earnings season
Signal From Noise
Highlights timely market themes and sectors with corresponding stocks, cutting through the day-to-day market “noise” for a distinct perspective.
Community Questions
We gather your inquiries and answer them in the most scalable way. Hear directly from our research principals!
FS Insight Academy
Our main goal is to make you a better investor! This series will guide you through key financial concepts and topics in an understandable way.
Webinars & Videos Free Macro Webinars
Live webinars and Q&A with our research team and high-profile industry leaders.
Quarterly
Free Crypto Webinars
Live webinars and Q&A with our research team and high-profile industry leaders.
Quarterly

*Daily reporting during each quarterly earnings season.

Disclosures (show)

Sign in to read the report!

We have detected you are an active member!

Ray: D69BFB2B-CB29-4822-8210-61AE4C574528

Don't Miss Out
First Month Free

Events

Trending tickers in our research