Core Viewpoint - The article emphasizes the importance of constructing a well-diversified investment portfolio, primarily focusing on a high-quality, low-cost S&P 500 ETF, while suggesting an overweight position in the technology sector due to its potential for long-term growth [1]. Investment Strategy - Investors are advised to build a diversified portfolio that includes a core foundation of a high-quality, low-cost S&P 500 fund [1]. - For those who can tolerate short-term risks, an overweight position in the technology sector is recommended, as it is believed to be in the early stages of a long-term secular bull market [1]. - For dividend income, large oil and gas companies that offer strong dividend income and growth are suggested as potential investments [1]. Capital Allocation Approach - The article advocates for a top-down capital allocation strategy that aligns with individual investor circumstances, such as age, employment status, risk tolerance, income, net worth, and investment goals [1]. - Suggested investment categories include the S&P 500, technology, dividend income, sector ETFs, growth, speculative growth, gold, and cash [1].

Core Viewpoint - The technology sector is currently a focal point in the market, showing strong short-term rebounds but indicating weakening long-term momentum, suggesting a cyclical adjustment may be underway [1][3]. Group 1: Market Dynamics - The technology sector, comprising 30% of the S&P 500 Index, typically leads market movements, both in bullish and bearish phases [1]. - The recent strong rebound in the XLK ETF since April has led to a successful breakout above its 200-day moving average, signaling short-term positivity [3][5]. - However, the monthly MACD has shown a bearish crossover, marking the first "sell" signal since early 2022, indicating a potential price adjustment lasting at least six months [3]. Group 2: Technical Analysis - The Technology Select Sector SPDR is currently in a long-term uptrend but is facing upward pressure due to diminishing momentum, suggesting that the recent rebound may stall [5]. - A supply zone exists between $228 and $241, where the XLK ETF previously experienced narrow fluctuations, indicating a potential halt in the current rebound [5]. - The relative strength of XLK compared to the S&P 500 has recently increased, indicating superior performance during the market rebound, but this may be a temporary trend [7]. Group 3: Future Outlook - Despite entering a technical bear market phase, a long-term bullish outlook is anticipated to re-emerge around 2026 [3]. - The current relative strength of technology stocks is likely to be more of a counter-trend nature, suggesting limited sustainability moving forward [7].