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

Technology & Utilities Ranked 1-2 For 3rd Consecutive Week
Click Here For This Week’s SEAF Model “Rainbow Charts” Update
Conclusion, Investment Implications, Strategy

For the third consecutive week, the SEAF Model has retained Technology (XLK) and Utilities (XLU) as the two top-ranked sectors.  Note that Utilities can now be construed as either a defensive or offensive sector due to the energy demands that AI has thrust upon the market.  Defensive Health Care (XLK) is the third-best-ranked sector this week, but with a Ranking score more than twice as large — which means less than half as strong — as XLK and XLU.  At the other end of the spectrum, economically sensitive Energy (XLE) and cyclical Financials (XLF) are again the two worst-ranked sectors this week.

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 our SEAF Rainbow Charts and a heat map that provide more color and detail on where sector-related assets are going, and where they are coming from, in the 11 Sector SPDR ETFs.   Our Rainbow Charts highlight SEAF’s past 12 months of Favored, Neutral, and Avoid rankings. 

From The Video: This Week’s Major Themes
  • Money is aggressively moving into Technology and Utilities in All time periods.
  • Money is aggressively moving into Health Care in the Trading and Tactical time periods.
  • Money is aggressively moving out of Communication Services and Consumer Discretionary in the Trading time period.
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.

Data through 10-9-2025. Click the table above to enlarge

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

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

SEAF Heat Map

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

Offensive Technology (XLK) is once again the SEAF Model’s top-ranked sector this week with a Ranking score of 3, slightly improving upon the rankings of 4 and 7 one and two weeks earlier.  Technology has been one of the top three-ranked sectors for 22 of the past 25 weeks beginning on Apr 24th, and has been the top-ranked sector 18 times during this period.  Meanwhile, Chart 1 below shows that XLK has outperformed the benchmark S&P 500 (SPY, lower panel) by 6% since returning to Favored status on Sep 9th .  Year-to-date (YTD), according to sectorspdrs.com, XLK is the best-performing Sector SPDR ETF, rising by 19.7% while outperforming SPY by 8.3%. This is the direct result of consistently bullish SEAF Ranking scores since late April.

Chart 1

Utilities  (XLU)

Defensive Utilities (XLU) is once again the SEAF Model’s second-ranked sector this week with a Ranking score of 6, which is significantly better/stronger than the scores of 13 and 14 one and two weeks prior.  The green highlights in Chart 2 below show that Utilities regained Favored status on September 23rd (upper panel), and that XLU has coincidentally outperformed the benchmark S&P 500 (SPY) by 8% since then.  Year-to-date, according to sectorspdrs.com, XLU  is currently the second-best-performing Sector SPDR ETF, rising by 19.2% while outperforming the S&P 500 (SPY) by 7.8%. 

Chart 2

Health Care (XLV)

Defensive Health Care (XLV) is the SEAF Model’s third-best-ranked sector this week with a Ranking score of 14, which is a more than double the Ranking scores of Utilities and Technology and means  XLV is twice as weak as the other two.  Chart 3 below shows that Health Care initially moved back into Favored status on Oct 2nd, following two failed attempts to rise and remain in Favored territory on Sep 11th and Aug 21st.  The last time that Health Care spent a sustained period of time in Favored status was back in March, as defensive sectors have been shunned in favor of more “risk on” sectors like Technology.  Year-to-date, according to sectorspdrs.com, XLV is the sixth-best performing Sector SPDR ETF, rising by 3.3% while underperforming SPY by 8.1%. 

Chart 3