We can certainly see some movement on this week's thematic table as equity markets have extended their decline.

The basic summary here is that high beta and growth have dropped on the list; examples of this include the Ark speculative growth funds and crypto stocks.

In addition to this, it's to no one's surprise that low volatility stocks have climbed to green territory on the rankings. These stocks outperform during market corrections and this is another example of that.

Extending on the speculative growth theme, Chinese equities (and international equities more broadly) have been a strong area of outperformance as money has rotated out of the United States and into international equity.

However, a scenario we're considering is if we see an oversold bounce in the coming weeks whether this money flow will reverse and funds will rotate out of international as a source of funds back into the U.S.

Pictured below is China $FXI hitting a significant level of resistance; we'd be surprised to not see some level of digestion here as this theme takes a well deserved pause.

This table captures the longer-term drift in the relative performance of the U.S. sectors as markets accelerate their selloff.

You can see groups like Communications $XLC continue to show leadership, while Consumer Discretionary $XLY, which was on the top, has dramatically fallen in recent weeks.

We've been pointing to this breakout level in XLY; last week we said buyers should come in and defend this breakout.

Well, they failed, rather spectacularly...

It's not just Amazon $AMZN or Tesla $TSLA dragging this ETF lower, it's a sector-wide story right now.

The Equal Weight Consumer Discretionary ETF $RSPD also failed to break above its prior cycle highs.

Retail stocks are undoubtedly being dragged lower because of this, but retail-expert Jeff Macke knows how to turn that weakness into an opportunity.

Tomorrow, Jeff’s breaking down which retail names are still worth buying — and which ones to stay far away from....

Large Cap Growth $IWF has stepped down on the rankings as Large Cap Value $IWD has climbed to the top.

Clearly, equity markets have sold off rather aggressively in recent weeks.

The S&P 500 $SPY has made new lows and is now retesting the final level in the sand at the 161.8% Fibonacci extension level. If the S&P 500 loses 560, the risk in owning equities over longer time periods significantly rises.

The area that's been hit the hardest has been crypto. The average token is now in its second 60% drawdown of the last 12 months. And the majors are not fairing much better. 

The bottom line, according to Strazza, is the two best crypto vehicles are currently sporting all the classic characteristics of fresh downtrends. 

See how he's playing these downtrends in this conversation with JC Parets. ...

The S&P 500 (United States) has fallen into red territory in our global rankings. This marks a notable development, as under our relative strength ranking America is now in the bottom half of the world in terms of market strength.

The chart below documents the ranking of the United States over the last three months and how it's now in red territory.

The trend favoring the United States has been a persistent one over the last 15 years, and has been marked by continued (and failed) calls of its demise.

But with global stocks nearing a historic breakout, we could be seeing the beginning stages of broadening market leadership outside the United States.

We're noticing many important cyclical groups beginning to transition to red, indicative of the lingering risk aversion impacting the U.S. markets right now.

The Semiconductor $XSD and Homebuilders ETF $XHB are two perfect examples.

Homebuilders $XHB are potentially forming a longer-term head and shoulders top.

While they sit on a strong level of support and we'd be surprised to see the ETF melt straight through this level, the fact this important group has transitioned to red points to growing cracks in this bull market.

Likewise, Semiconductors $XSD are also selling off very hard right now.

While they remain stuck in the middle of a long-term range, this does point to a weakening of market breadth among important risk-on groups.

In a market environment such as this, being selective remains more important than ever. The industry with perhaps the greatest risk in a looming trade war is the consumer.

JC Parets and retail-expert Jeff Macke went live in a special strategy session to discuss exactly this - the best stocks to buy in the face of a trade war.

You can unlock...

A number of more defensive sectors, like Consumer Staples $XLP, Real Estate $XLRE, and Health Care $XLV are transitioning to green as U.S. markets sell off. This points to the growing risk aversion from investors as money rotates into lower beta and safer equity plays.

We're at a key conjecture between more significant drawdowns in risk groups or buyers stepping in to defend key levels. Last week I pointed to the Consumer Discretionary ETF $XLY retesting its breakout level at the 2021 highs.

Prices continue to work lower in the short-term, and now is when buyers must step in to defend this level.

As evident by the recent dip in this chart, consumer stocks are shifting fast.

There's a lot of headline risk right now with tariffs and trade wars, and there are bound to be significant winners and losers in this space in the coming months.

It's more important than ever to be selective in this group, so that's why retail-expert Jeff Macke is going live at 4pm today (Thursday) where he’ll break down the biggest moves in retail and reveal his model portfolio.

...

The big insight here is that equity markets failed to follow through on their strength to close last week.

The Nasdaq 100 ETF $QQQ, for instance, is now breaking below a key level of support. Unless buyers step in right now, there is elevated downside risk in stocks in the short-term.

The key piece of information here is how more and more international diversified ETFs are overtaking the US' S&P 500 $SPY.

International stocks have outperformed YTD versus the United States, a trend that has persistently favored the latter for well over a decade. This has us wondering whether we're entering into a new regime of widening global breadth outside the United States.

Something we're pondering in the short-term, however, is whether we see some rotation back into the United States as many U.S. growth names closed the week bouncing off support while many international ETFs hit their highs.

Take Colombia $GXG, for instance, which is finding resistance at its 2024 highs.

Meanwhile, the Nasdaq 100 $QQQ defended a key level of support.

And while this took place, the relative trend favored the United States over international in a strong way to close last week. Take a look at how much international stocks $VEU underperformed on Friday.

While these are shorter-term trends, the big picture is impossible to ignore.

More international markets are beginning to outperform...

What immediately stands out is how the precious metal miner ETFs have migrated to the top of the table. This points to a pronounced increase in relative strength as equity markets have sold off.

You can see how all these ETFs have transitioned to a darker green in recent weeks.

It's no surprise to see these ETFs outperform the market in periods where gold is also outperforming.

Tracking the ratio of Gold relative to stocks, this ratio tends to exhibit strong upward spikes, followed by prolonged periods of downward of sideways action. Right now, this ratio is experiencing yet another spike as stocks sell off.

Whether or not this trend favoring precious metal stocks is sustainable is yet to be seen, as of yet. But in either case, to top the ETF Power Rankings is no small accomplishment; there is serious relative strength here.

As US stocks have sold off in recent sessions, China growth has migrated to the top of the rankings.

Notably, this group found itself well into the red during the most correction. But this rotation into international stocks is having implications across many key intermarket trends.

The China Technology ETF $CQQQ is on the cusp of completing this massive multi-year base breakout. If a breakout can manifest here, it would be tremendously bullish for this theme.

US sectors have experienced some notable weakness this week as many groups fail to hold their recent breakouts.

While this does a paint a picture that the market environment is transitioning to a choppier period, it is important to view this within the context of the longer-term trends.

Let's take Consumer Discretionary $XLY as an example.

The ETF has just broken to new lows, and the short-term trend has shifted lower.

But when we zoom out, the ETF is actually sitting on top of a significant breakout level. Typically, retests such as these are often met with strong demand.

It's unsurprising to see this weakness early in the year considering the last two years of significant market gains. The third year of bull markets can be more choppy than the preceding two, but longer-term the trends are constructive.

Perhaps the most surprising element of this recent weakness is crypto. While stocks have sold off modestly, crypto is enduring quite a beating. Our Senior Crypto Analyst, Louis Sykes, will be joining Director of Research, Steve Strazza, in an emergency crypto update at midday today.

Growth and large cap factors continue to lead in the green on the US indices table.

Importantly, many indexes have been rejected after testing their most recent highs.

While this isn't a cause for concern, it does suggest that the short-term trend has shifted sideways as many key ETFs are no longer in a period of price discovery.

In these sorts of environments we're always looking for leadership, and that's precisely what retail-expert Jeff Macke is doing. If you want to see his favorite retail stocks, you can get connected by clicking here.