Power Sector (XLE) Hits All-Time Excessive, Ought to We Fear?

KEY

TAKEAWAYS

Power (XLE) Logs New All-Time Excessive
XLE “Bearish Shift” on Silver Cross Index

The Power sector (XLE) has been having fun with a rally all through the summer time. Right this moment it logged a brand new all-time excessive on a small breakout. Whereas the sector appears to be like impervious, there are a number of considerations that we should always level out. First can be the overbought RSI. Whereas a inventory’s worth can stay overbought, sometimes when the RSI reaches this stage you will note at the least a pause. The opposite challenge is the “Bearish Shift” of the Silver Cross Index (SCI) because it crossed beneath its sign line. The remainder of the indications, together with our main Value Momentum Oscillator (PMO) are bullish. You may discover that participation (%Shares > 20/50/200EMAs) stays nicely above our bullish 50% threshold and actually is not bleeding off a lot. Stochastics are comfortably above 80 suggesting inside energy.

Conclusion: The Power sector appears to be like very sturdy, however we’re noticing a number of issues beneath the floor. We should always do not forget that overbought circumstances can persist in a bull market which XLE clearly is in. If the Silver Cross Index continues to lose floor, we’d tighten stops in your Power positions.

If you would like to be notified when main indexes, sectors and choose trade teams see “Bullish/Bearish Shifts” and given the bias within the intermediate and lengthy phrases? You may discover it in each DP Alert report!

Good Luck & Good Buying and selling,

Erin Swenlin

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Technical Evaluation is a windsock, not a crystal ball. –Carl Swenlin

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In regards to the creator:
Erin Swenlin is a co-founder of the DecisionPoint.com web site alongside together with her father, Carl Swenlin. She launched the DecisionPoint each day weblog in 2009 alongside Carl and now serves as a consulting technical analyst and weblog contributor at StockCharts.com. Erin is an energetic Member of the CMT Affiliation. She holds a Grasp’s diploma in Info Useful resource Administration from the Air Pressure Institute of Expertise in addition to a Bachelor’s diploma in Arithmetic from the College of Southern California.

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