The resurgence of growth could spark a move back into big tech, but the latest market moves could also make way for inverse plays with the Direxion Daily Technology Bear 3X ETF (TECS).

The Nasdaq 100, despite being up about 14% on the year, took a dip just recently. This caused TECS to tick 2.4% higher in Thursday’s trading session.

“The Nasdaq ended lower on Thursday, pulled down by Apple, Amazon and other Big Tech companies as a fall in weekly jobless claims data fed investor concerns about a recent inflation spike,” a Reuters report noted.

“The S&P 500 technology sector index ended a four-day winning streak,” the report added. “Earlier this week, investors’ favor for heavyweight growth stocks pushed the S&P 500 and the Nasdaq to record highs.”

^NDX Chart

TECS seeks daily investment results, before fees and expenses, of 300% of the inverse (or opposite) of the daily performance of the Technology Select Sector Index. The index is provided by S&P Dow Jones Indices and includes domestic companies from the technology sector.

One of the key market movers will be inflation. It’s been the subject of interest the past few months.

“People are very nervous and concerned about inflation, tax rates and the (2022 midterm) election. Those three things are very much on people’s minds,” said 6 Meridian Chief Investment Officer Andrew Mies.

The Other Side of the Trade

On the other side of the trade, those expecting bullishness for the tech sector can play the Direxion Daily Technology Bull 3X ETF (TECL). The fund seeks daily investment results, before fees and expenses, of 300% of the daily performance of the Technology Select Sector Index.

The fund, which is up close to 50% this year, invests at least 80% of its net assets (plus borrowing for investment purposes) in financial instruments, such as swap agreements, and securities of the index, ETFs that track the index, and other financial instruments that provide daily leveraged exposure to the index or ETFs that track the index. The index includes domestic companies from the technology sector.

TECL Chart

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