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Between the massive tech dump and headlines that the ceasefire is over, volatility is back. Join Geof and me live right off the open as we see if the market can catch a bounce and map out exactly how we’re playing these wild swings [tap to join us for Profit Panel]
The trade that’s been working isn’t the one most people are watching.
While everyone’s still talking about AI and software, the real-world sectors are the ones pumping.
We’ve been talking about this consistently — the real-world buildout for AI and the manufacturing companies tied to it are driving the current rotation.
Industrials, the Russell 2000 (IWM), raw materials providers and the banks financing the capital expenditure buildout continue to lead.
The Dow Jones Industrial Average (DJIA) keeps pushing higher. IWM is up, and meanwhile the Nasdaq 100 (QQQ) continues to underperform.
The S&P 500 (SPY) is holding up better, but leadership has shifted. Even within market capitalizations, the dispersion is clear: The S&P MidCap 400 is noticeably weaker than large caps while the Russell 2000 has been smokin’. That tells you where money is actually flowing.
Tech-focused ETFs — chips, space, nuclear and quantum — aren’t the place to look right now.
The opportunity is in the companies expanding physical infrastructure and the banks writing the checks that make it possible.
What I’m Watching Instead
I’m focused on shipping, manufacturers and the banks driving this buildout. This rotation isn’t random — it’s the next chapter of the AI story.
Instead of speculation on what AI might do someday, capital is pouring into the real-world systems that need to be built today.
Higher rates for longer actually help banks in this environment. They’re financing massive capital expenditures, and that becomes a tailwind.
We’re already seeing examples of this shift play out. One of the standout setups recently was the Alpha Flow Dashboard on Dow (DOW), where contracts were trading for $1.75.
That type of opportunity shows how sector rotation is creating clean, high-leverage trades.
When I look for overnight setups, I’m often considering IWM or DJIA components over anything in software. The strength is that clear.
How to Trade This Rotation
If you want to play high-beta setups today, financials offer more potential than software.
The rotation isn’t a headline — it’s a persistent trend with real follow-through.
There’s nothing particularly bearish right now, but ignoring the rotation is risky. Markets can be strong while leadership changes under the surface.
That’s exactly what’s happening. The software and AI darlings from six months ago are lagging while real-world assets — trains, autos, manufacturers and raw materials — continue to show up on scans with consistent strength.
Cash is still a position, but rotating into strength isn’t chasing. It’s following the market’s lead and respecting where momentum actually lives.
To better trading,
Alex Reid
WealthPin
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.Â
P.S. Post-Fed Meeting Opportunity Lining Up…
I’m watching three stocks setting up pretty well right now, together with the best options to trade them!
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Disclaimer: We develop tools and strategies to the best of our ability, but we can’t guarantee the future. There is always a risk of loss when past performance is not indicative of future results. The profits and performance shown are not typical, and you may lose money. Since the Alpha Flow Dashboard is a tool designed to help traders make informed trading decisions, results will vary by user, as there are multiple trades to choose from.
