Prep For A Move In Either Direction With These Sectors
ETF Trade Watch
The market is taking a bit of a pause as we chop around, waiting for trend and direction since starting this week considerably lower than where we were late last week. This means we are being extra patient until we have a good opportunity to put on high probability trades.
Since we are relatively flat today, there are two ways you can play the market.
Vanguard Communication Services ETF (VOX)
If the market were to continue its climb higher than an area that would likely be carrying much of the load would be the Communications Services Sector. This ETF has holdings in names such as Alphabet (GOOGL), Meta Platforms (META), and Verizon Communications (VZ).
Up 13% on the month, VOX has given back some ground over the past week. However, this could very well be a temporary pull back in the market after it’s impressive run. A pullback can very often turn into a retest of a previous resistance level, before moving higher. Be on the look out for this as the week develops.
Energy Select Sector SPDR ETF (XLE)
For those who are looking to go short, there’s riding with energy, which has been one of the preferred areas to be when the market slides.
Keeping an eye on oil prices is something you always want to do when planning to enter a trade on energy. While this sector usually rises on market weakness, it is more closely tethered to the price of oil rather than the overall market.
If you want to join my students and I as we learn how to look at sector ETFs for our trades then you’ll want to become a member of my Smart Trades options trading service. Not only will you get all my trades, but you’ll also be a part of a growing community of like-minded traders looking to learn and hone their options trading skills.
I look forward to trading with you, but until then, as always…