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

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Offensive Tech, Cons Discretionary Among The Top SEAF Rankings This Week
Conclusion, Investment Implications, Strategy

The SEAF Model graphic below shows that offensive, “risk on” sector Technology (XLK), which has maintained a top-three ranking according to the model for the fourth consecutive week, is joined this week by Consumer Discretionary (XLY), another offensive sector. Economically sensitive Industrials (XLI) also joins the top-three ranked sectors this week for the first time since Feb 6th.  At the other end of the spectrum, defensive Health Care (XLV) and Consumer Staples (XLP) are the two weakest sectors according to SEAF.

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 Technology in All time periods.
  • Money aggressively moving into Consumer Discretionary in the Trading and Tactical time periods.
  • Money aggressively moving out of  Health Care 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 where the money is going and to avoid the sectors where the money is coming out.  

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 Technology and Consumer Discretionary.  This is where the money is currently going in the sector space.

The latest data also indicates a multi-timeframe trend of asset outflows out of Consumer Staples and Health Care.  This is where the money is coming from.

SEAF Heat Map

SEAF Heat Map: 05-19-2025

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).

Technology: XLK

Economically sensitive Technology (XLK) is the SEAF Model’s top-ranked sector this week, with a very high Ranking score of 4.  Technology jumped back into top-three status according to the SEAF Model on Apr 24th, for the first time since Feb 20th, and has remained there since.  A closer look at Chart 1 below shows that XLK has coincidentally outperformed the S&P 500 (SPY) by 5.0% during this period, driven by this recent aggressive expansion of assets.  As long as Technology retains its current Favored status, recent outright strength and relative outperformance versus SPY are likely to continue.

Chart 1

Industrials: XLI

Economically sensitive Industrials is the SEAF Model’s second-ranked sector this week with a Ranking score of 12.  This is the first time Industrials has been one of the top three ranked sectors according to SEAF since February 6th.  Meanwhile, XLI coincidentally edged into fresh relative outperformance extremes versus the S&P 500 (SPY, lower panel) and is now at its best relative level versus SPY since late April 2024.  As long as Industrials remains Favored according to SEAF, recent relative outperformance by XLY versus SPY is likely to continue.

Chart 2

Consumer Discretionary (XLY)

Cyclical Consumer Discretionary is the SEAF Model’s third-ranked sector this week with a Ranking score of 13.  This is the first time Consumer Discretionary has been in a Favored status (upper panel) according to SEAF since February 6th.  The green rectangle in the middle of the chart shows that the sustained period in Favored status by Consumer Discretionary between Oct 24th, 2024, and Jan 10th (upper panel) coincided with 10% of relative outperformance by XLY versus the S&P 500 (SPY, lower panel).  The longer that Consumer Discretionary remains in Favored status, the more likely we will see relative outperformance by XLY versus SPY.

Chart 3