Weekly-updated PDF of all SEAF Rainbow Charts:  Click the link below to download a PDF of this new addition to our research services.

Click Here For This Week’s SEAF Model “Rainbow Charts” Update
Investors Remain Defensive Following Last Week’s Big Rally
Conclusion, Investment Implications, Strategy

The SEAF Model graphic below shows that defensive Utilities (XLU) and Consumer Staples (XLP) have retained the previous week’s position as the second and third-best-ranked sectors according to the SEAF Model, while cyclical Financials (XLF) has replaced defensive Health Care (XLV) as the top-ranked sector.   These latest data continue to suggest that, despite last week’s huge rally, the market remains positioned overall for more broad market weakness.  Money did indeed rush into “risk-on” offensive sectors Technology (XLK) and Communication Services (XLC) on a very short-term Trading basis last week, but it remains to be seen whether this knee-jerk reaction to last week’s big rebound will continue — and is probably necessary for a more sustainable broad market bottom to emerge from the recent lows.

Beyond The SEAF Model Video: This Week’s Sector Themes

This weekly video by Jack Kosar goes into more detail on the latest SEAF Model data via a heat map that provides more detail on where sector-related assets are going, and where they are leaving, in the 11 Sector SPDR ETFs.  Jack also displays and discusses our SEAF “Rainbow Charts” highlighting SEAF’s past 12 months of Favored, Neutral, or Avoid rankings. 

From The Video: This Week’s Major Themes
  • Money aggressively moving into Financials and Utilities  in the Tactical and Strategic time periods.
  • Money aggressively moving into  Technology in the Trading and Tactical time periods.
  • Money aggressively moving out of Energy in All time periods.
The SEAF Model: Current Signals & Related Performance

Editor’s Note:  These are the latest specific trading signals generated by our SEAF Model, which also includes a rules-based money management component.  The backtested performance data below is based on trading a predetermined amount of assets with an equal allocation of those assets across the top three Rankings.  The model is updated once per week, on the weekend, and any rebalancing takes place on the market opening the following Monday morning.  This is the recommended way to invest via the SEAF Model.  Contact us for any additional clarification.

In the SEAF Model Graphic below, the Ranking column sorts the entire table of 11 sector ETFs according to the sum of rankings in the Trading (weekly), Tactical (monthly), and Strategic (quarterly) categories, from largest inflows to largest outflows.  The premise of the model is to invest in the sectors that the money is going into and to avoid the sectors the money is coming out of.  

The lower the Ranking number, the stronger the trend of asset flows going into that sector.  The top two sectors in each category, according to a positive change in inflows, are highlighted in green.  The top two sectors in each category, according to a negative change in outflows, are highlighted in red.

Click the table to make it larger

The latest data indicate a multi-timeframe trend of asset inflows into Financials and Technology.  This is where the money is currently going in the sector space.

The latest data also indicate a multi-timeframe trend of asset outflows out of Energy.  This is where the money is coming from.

NEW! SEAF Heat Map

SEAF Heat Map_ 04-14-2025

The SEAF Heat Map provides additional insight into the flows of the 11 Sector ETFs. Each time frame is independent, meaning the color spectrum for one period does not affect another. For example, the strongest inflow (dark green) for the trading week is separate from the strongest inflow for the tactical month.

The heat map visually represents the spectrum of inflows and outflows, with green indicating inflows and red indicating outflows. The more extreme the flow, the darker the corresponding color—deep green for strong inflows and deep red for strong outflows. Flows closer to yellow indicate minimal percentage change.

This tool serves as an additional layer of information to help investors not only identify where sector flows are moving but also gauge the relative strength of those flows compared to their peers.

SEAF Model Individual Sector Charts (“Rainbow Charts”)

The charts below display the weekly SEAF Model Ranking Scores over the previous 12 months for the strongest and weakest sectors through September 12th.  The line in the upper panel displays these weekly scores within the context of being Favored (3-15, green), Neutral (16-24, yellow), or Avoid (25-33, red) and also displays the trend of asset flows as the money moves in and out of these sectors.  The lower panel plots the corresponding weekly relative performance chart of that particular sector versus the S&P 500 (SPY).

Financials (XLF)

Cyclical Financials (XLF) is the SEAF Model’s top-ranked sector this week with a Ranking score of 7.  Financials has been one of the top-three-ranked sectors for three of the past four weeks beginning on Mar 24th.  The green highlights in Chart 1 below show that Financials initially moved to Favored status on March 13th (upper panel) and, except for a quick one-day move to Neutral status on Apr 3rd, has remained there since while XLF has coincidentally outperformed the S&P 500 (SPY, lower panel) by 3%.  

Chart 1

Utilities: XLU

Defensive Utilities is the SEAF Model’s second-ranked sector this week with a Ranking score of 12.  Utilities has been one of the top-four-ranked sectors for the past five weeks, beginning on Mar 17th.  As a result, through the end of last week, XLU has been the second-best-performing Select Sector SPDR ETF year to date, rising 0.8% while outperforming the S&P 500 (SPY) by 9. 6%.  The green highlights in the upper panel of Chart 2 below show that Utilities initially moved into Favored territory on Feb 7th (upper panel) and, with the exception of a few quick moves in and out of Neutral status, has remained there since.  The lower panel shows that XLU has coincidentally outperformed the S&P 500 (SPY) by 12%.

Chart 2

Technology: XLK

Economically sensitive Technology (XLK) is the SEAF Model’s fourth-best-ranked sector this week with a Ranking score of 14, driven by its #1 and #2 rankings in the Trading (weekly) and Tactical (monthly) time periods last week.  Chart 3 below shows that Technology streaked from being deeply buried in Avoid status to being slightly in Favored status in just three days, between April 8th and 10th, even though it is still ranked dead last in the Strategic time period at #11.  It would take a sustained move back into Favored status over the next several weeks to indicate there is enough bullish conviction to fuel Technology to a new period of broad market leadership.  Note that Technology’s previous recent move into Favored status only lasted about a week or so, between Fed 13th and 21st, before collapsing back into Avoid status (upper panel) as XLK moved to new relative lows versus the S&P 500 (SPY, lower panel).  Technology is currently the second-worst-ranked Select Sector SPDR ETF year to date, underperforming the S&P 500 (SPY) by 5.9%.

Chart 3