Trading Strategy – Consumer Staples Select Sector SPDR ETF

 
Consumer Staples stocks were under selling pressure Tuesday amid ongoing concerns that escalating trade war could drag on earnings. After surging about 10 percent in 2017, the Consumer Staples Select Sector SPDR ETF (XLP) fell 0.42 percent Tuesday to 54.73, down nearly 4 percent YTD while the S&P gained more than 8 percent over the same period.  Now the question is whether recent pullback is a pause that refreshes or it’s a beginning of a something worse?  Below is an update look at a trade in XLP.

The graphic below is from our “U.S. Market Trading Map”, show the near-term technical bias and trading ranges.  As shown, the underlying is in a short-term bullish trend when the price bars are painted in green.  The underlying is in a short-term bearish trend when the price bars are painted in red. 

Chart 1.1 – Consumer Staples Select Sector SPDR ETF (weekly)

Our “U.S. Market Trading Map” painted XLP bars in red (sell) – see area ‘A’ in the chart.  Over the past few weeks, XLP has been basing sideways near the 2-year moving average after the May recovery rally stalled near the February congestion zone.  This is a bearish development, indicating…Click here to read more.

You see, our trend-following system is very unique as it attempts to pick turns before others see them. Timing is everything and if you’ve applied our system correctly, you should have made a killing in any markets.

 

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