Beginners Series Webinar: Join us on Friday, July 25th at 2 PM (ET) for our NDW Beginners Series Webinar. The week's topic is: Dynamic Asset Level Investing (DALI) and DALI Strategies. Register Here

Extra! Extra! Read all about it! While Hollywood box office names have dominated the summer, the real show is unfolding on the charts. Evidently, Communications continue to hold the #1 spot on the DALI sector ranking, showcasing tremendous leadership relative to the other 10 broad market sectors for the past four months. Leading the charge, sector representative XLC has extended its two year uptrend, hitting fresh all-time highs again today. The fund continues to ride strong relative strength trends, having sat in a relative strength column of X’s since February 2023.

There are several different areas you or your clients might be interested in within the sector. Most often the tech focused names within the sector get the most attention, but recently other areas within the sector have performed quite well. Media and other traditional telecom names have been points of strength. The Bullish Percent for Media ^BPMEDI, current readings sit at 44%, the highest we’ve seen since October 2024. To put that in perspective, nearly 4 out of every 10 stocks in the sector are now on PnF buy signals. While not yet overwhelming, this is the first meaningful participation we’ve seen in months coming off lows of 16% in April and its on par with most other sectors as we close out July.

Looking at a more targeted vehicle for media exposure, SOCL maintains a fund score of 5.84, with a fresh trend and established relative strength vs the market SPXEWI. While it may not carry all of the same blockbuster holdings as large cap tech, SOCL offers a direct tie to consumer engagement and digital media growth. Notably, OBOS levels have inflated up to 114%, a significant increase over the last few trading weeks, signaling the fund may be due for some normalization. Watch the middle of the trading band around $50 as a logical entry point in the near-term.

Everything’s better on the big screen, and ROKU brings the big screen home. This 5 for 5’er has surged from a TA score of 2 to 5 in just three months and now ranks 3rd within the Media sector. ROKU has held a relative strength buy signal vs. the market since December 2024 and is up 21% YTD. While the technical setup remains strong, ROKU carries an RRisk of 4.6, making it more appropriate for aggressive investors. The stock is still a bit elevated around current levels but has recently pulled back... offering a decent entry point around current levels. Localized support is found at $89 and $86, and Q2 earnings are expected on 7/31.

Among other effects, the “Big Beautiful Bill,” which was signed into law on July 4th, was expected to be detrimental to clean energy as it eliminated tax subsidies for things like electric vehicles and renewable energy projects, which has been a conspicuous source of tension between President Trump and his former advisor Tesla CEO Elon Musk. As CEO of both SolarCity and Tesla, Musk stood to lose on multiple fronts, so it’s no wonder he wasn’t too happy about the tax policy change. While the media has been pessimistic about the prospects of clean energy firms, their performance has been just the opposite, at least over the short-term.

Image Source: Politico

Over the last 30 days, the Invesco Wilderhill Clean Energy ETF (PBW), the Invesco Solar ETF (TAN), and the First Trust Nasdaq Clean Edge Green Energy Index Fund (QCLN) are each up more than 15%, led by PBW which is up just 30% over that period. Short-term performance isn’t everything, of course, as even long-term laggards occasionally have sharp rallies. But each of the aforementioned funds also now have favorable technical pictures. TAN leads the pack with a 4.93 fund score, followed by PBW and QCLN with have fund scores of 4.64 and 4.00, respectively.

There are a variety of stocks that make up the clean energy ETFs, but the strongest performers are primarily solar stocks. Solaredge Technologies (SEDG) is up more than 80% over the last 30 days and 114% year-to-date, the stock has a 5 for 5 technical attribute rating and has completed three consecutive buy signals on its default chart. Sunrun Inc (RUN) another purveyor of solar equipment and renewably sourced energy is up more than 70% over the last month. RUN has a 4 for 5 technical attribute rating and sits one box away from returning to a positive trend, which would elevate it to a 5 for 5’er. Among non-solar stocks, MP Materials Corp. (MP), which is a rare-earth materials company, is among the top performers. MP has gained more than 67% over the last month and 292% year-to-date. MP is a 5 for 5’er and ranks first out of 14 names in the metals non ferrous sector matrix. There are far too many clean energy stocks for us to review them all individually, but if you’d like to find other names, you can use the “Holdings” function from the chart of any of the ETFs discussed above.

We can’t say why many clean energy stocks have made eye-popping gains over the last month, defying expectations that the “Big Beautiful Bill” would be calamitous for the industry. Perhaps the market had become overly pessimistic ahead of the bill’s passing or perhaps investors think that the increased demand for energy from AI means that renewables will remain part of the energy mix over the next several years. What we can say is that the expectations have been wrong, at least over the short term, and we are seeing relative strength in clean energy. Situations like this are one of the reasons why we prefer to listen to what the market tell us IS happening versus what stories that tell us what ought to happen.

Daily Option Ideas for July 24, 2025