Sector Spotlight: Bull Flags Form On These Sector ETFs
Market Recap For August 2nd, 2022
As suspected, markets took another stab higher. However, once again, the attempt to push through key resistance marks failed.
The Dow, in particular, looks set to fall. In addition, both the S&P and Nasdaq have formed weakening momentum on the most recent runup.
Yesterday’s Sector Performance
All sectors ended up in the red, with Services barely winning the day.
Real Estate fell to the bottom of the market.
Five-Day Sector Performance
Discretionary is still the weekly leader, no changes.
Healthcare is not only at the bottom, but it is now the only sector in the red.
ETF Trade Watch
Energy Select Sector SPDR (XLE)
Oil failed to retake the $95 level or the 200 MA, which means the potential for a big fall remains present. The XLE would see some substantial downside if a bigger rejection take place in oil prices. Oil prices have trended down since the beginning of June, where the prices reached as high as $122 before falling for the past two months. Traders should keep a close eye on prices to see if prices will bounce back or continue to decline.
Real Estate Select Sector SPDR (XLRE)
With Real Estate seeming to break down yesterday, a larger pullback could be in the works for the XLRE. As mortgage rates fall, along with prices due to falling demand for homes, this could continue to create downward pressure on this real estate ETF. As with oil prices and demand, traders should continue to watch this trend in the housing market in order to identify opportunities, either to the downside or upside.