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Just as you’d expect when the market turns over, Utilities and Health Care become the top-performing sectors in the market. With the market continuing to look relatively weak compared to last week, we can reasonably assume these sectors remain at or near the top of the list of best performing sectors.

Much like the utilities sector, Health Care is also considered to be a more defensive industry as far as investors and traders are concerned. Similar to Utilities, Health Care is an industry that has customers whether the economy is up or down.

Health Care Select Sector SPDR ETF (XLV)

Up almost 5% this past week alone, the XLV has joined the XLU in its rally. Powered by stocks like UnitedHealthcare (UNH) and Amgen (AMGN), this sector provides a way for long-term investors to squeeze some value out of a market that has been pretty stingy at times. This sets traders up with a nice opportunity to make a higher probability trade.

By playing this sector as a contrarian view on the market, traders can use this current pull back to their advantage. However, its is still our view, until proven otherwise that this is simply a pullback before a move higher in the market. Unless some key levels on the major indexes are broken, this will remain our view.

This implies that any trade on the XLV would be a shorter-term trade, as we do expect the overall market to make one more push upward. This may prove to be an incorrect view, in which case, these trades would be validated.

If you want to see all the latest trades my students and I put on for my Smart Trades options trading service, you’ll have to join today! Smart Trades is where I teach my students how I trade options on some of the largest ETFs on the exchange. As you learn, you’ll get exclusive access to all my trades with notifications any time one is put on. Now, you can learn how many use this high-income skill to achieve financial freedom. Join today!

I look forward to trading with you, but until then, as always…

Good Luck With Your Trading!

Christian Tharp, CMT

Christian Tharp

I am an expert stock market coach having helped over 4000 beginner and advanced traders & investors from around the world take control of their financial futures. I also write stock market related articles for the Adam Mesh Trading Group. My Chartered Market Technician (CMT) designation substantiates me as an expert in areas such as the technical analysis of stock trends, market indicators, cycles, price patterns, Elliot Wave principles, Candlestick charting, analyzing financial trends and behaviors, portfolio strategies, and forecasting future price movements. With my straightforward approach to simple, systematic trading, students learn how to strategically assess buy signals and market entry timing, establishment and management of stop losses, and how to employ a simple and disciplined trading approach that creates profits.

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