Correlation Breakdown

Stocks recover after a shaky week, one indicator shouts the great rotation is underway

February 9, 2026 Ripple Effect — February 9, 2026 On Friday, during a face-ripping rally, the S&P 500 rallied nearly 2% and erased a week of losses. The week’s trading revealed that a rotation out of high-flying tech into defensive names is well underway. The Dow, which includes broader, non-tech-related stocks, is starting the week above 50,000 for the first time in its history.   The correlation between S&P 500 sectors indicates capital flight from tech into other sectors.  (Source: Sentiment Trader) Prior breakdowns in S&P 500 correlation have signaled market weakness. Most notably in the tech wreck of 2000-01. “We’ve got our eyes peeled for further signs of a tech selloff,” notes our portfolio director, Andrew Packer. “Take some profits off the table, and expect more big swings.” If markets sell off in earnest, the correlation between sectors will get back into whack… as everything gets sold off in unison. ~ Addison Which Side of the AI Wealth Gap Will You Be On? AI is about to split America into two over the next 12 months… On one side, it'll make America's one-percenters richer and more powerful than ever… But on the other side, it's set to trap millions of hardworking Americans in financial quicksand… One ex-hedge fund manager whose team predicted NVIDIA's rise in 2020 calls this the "AI End Game"... And he says there are three critical moves every American should make in the next 12 months to protect and grow their wealth through this paradigm shift… CLICK HERE TO SEE THE DETAILS BEFORE IT'S TOO LATE P.S. On Friday, Andrew, Mark Jeftovic, and I dug deep into the bitcoin and crypto selloff on  Grey Swan Live! We unpacked a set of signals in crypto and Dollar 2.0 digital assets that rarely appear together — and almost never by accident. As a proxy for the space, bitcoin is down close to 50% after another pullback over the weekend. Now is a good time to know what the sell-off means for gold, silver and the companies we still recommend in our  Dollar 2.0 thesis. Check out the replay in the members section of the Grey Swan website. If you have requests for new guests you’d like to see join us for Grey Swan Live!,  or have any questions for our guests, send them here. How did we get here? Find out in these riveting reads: Demise of the Dollar, Financial Reckoning Day, and Empire of Debt — all three books are now available in their third post-pandemic editions. You might enjoy one or all three. (Or… simply pre-order Empire of Debt: We Came, We Saw, We Borrowed, now available at Amazon and Barnes & Noble or if you prefer one of these sites: Bookshop.org, Books-A-Million or Target.) Please send your comments, reactions, opprobrium, vitriol and praise to: feedback@greyswanfraternity.com

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