The S&P 500 has held onto morning gains so far this afternoon, which is a positive sign. Below is a look at our trading range charts for S&P 500 sectors (Real Estate excluded). The red shading in each chart represents overbought territory, while the green shading represents oversold territory. We’ve drawn trend lines where applicable.
The Consumer Discretionary sector has solidly broken its short-term downtrend channel and is now making a run for a test of prior all-time highs. It’s the complete opposite story for Consumer Staples, which remains in a nasty downtrend.
The Energy sector appears to have made a double top recently, so it will be interesting to see how it trades over the next few weeks. The Financial sector has been a big disappointment relative to other cyclical sectors over the last month or two. As other areas of the market have rallied, the Financials remain stuck in a downtrend. The Industrials sector had a pattern very similar to Financials up until the last few weeks, but it has managed to break above its downtrend channel and is so far holding above support at its 50-DMA. Both Health Care and Materials look similar to Industrials.
Of the ten sectors shown, it’s Technology that looks the strongest. Today the sector broke out to another all-time high, which marks the resumption of its long-term uptrend channel.