Sector Spotlight: Stocks Take A Breather
Market Recap For August 11th, 2022
Thursday morning brought another rally right out of the gate. However, unlike Wednesday, this time saw a reversal of nearly all gains.
Everything about yesterday’s market was bearish, complete with a daily negative momentum divergence.
Yesterday’s Sector Performance
Energy ended up as the clear leader on Thursday.
Healthcare finished up on the bottom.
Five-Day Sector Performance
Energy has had a nice run of late, putting it on top of the overall market.
Consumer Discretionary is now the only sector in the red.
ETF Trade Watch
Energy Select Sector SPDR (XLE)
Consumer Discretionary Select Sector SPDR (XLY)
Although it may just be a countertrend move, oil is performing well, which means so is the XLE. After the sell-off in energy prices, stocks are rebounding. Energy prices are among the most volatile of any in the commodities market. Prices can fall then quickly reverse in the other direction as bottlenecks continue to plague the industry.
If the market is set to wash out some of the excesses, discretionary stocks will most likely take a hit. If this happens, traders could look to the downside of the sector ETF XLY. Next week will paint a better picture of if this bull rally still has some steam left.