When the majority of best-performing stocks in an industry fall sharply on heavy volume and are unable to recover, typically other stocks in the same industry could become vulnerable.

The Industry Group Relative Strength Rating (also found in IBD SmartSelect® Corporate Ratings) can help you spot this situation. Watch any stock whose rating falls, especially if it goes to a C, D or E. Also check if ratings of leading stocks in the same group are dropping. The more they drop, the bigger the hint you should avoid the group.

If you want to track changes in specific industries, take a look at IBD's 197 Industry Group Rankings, found on IBD's Industry Groups page. This is the complete list of all 197 industry groups, ranked by performance over the past six months. On Mondays, Wednesdays and Fridays the table includes performance data over the past three months. Check for groups slipping in rankings, and pay attention to groups underlined because those are the prior day's worst performers. The various rankings help you identify long-term changes as well as sudden shifts among industry groups.

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Related Resources:

Review IBD's 20 Rules For Stock Market Success.

Go to the Investor's Corner Archives to read IBD's "editor picks" of classic Investor's Corner columns.

Search our archive of Ask Bill O'Neil Q & A's organized by topic.