Below we highlight charts for a half-dozen US equity ETFs as we start this holiday-shortened trading week. Over the past few weeks, investors have been largely turning away from stocks/ETFs that are more cyclical in nature. Meanwhile, defensives such as REITS, like the REIT ETF (VNQ), have held up better. In the case of VNQ, the ETF is actually headed into today right near a breakout of its 52-week high. The Aerospace and Defense ETF (PPA), while more of a cyclical industry, is also sitting near highs from the past year as it has for a couple of weeks now. The S&P Insurance ETF (KIE) is another industry that is looking promising as it has pulled back to the bottom of this year’s uptrend.
Other industries that are more susceptible to global growth trends have been rolling over. Namely, the S&P Metals and Mining ETF (XME) has been in a downtrend for some time now. After running up to the top of its downtrend channel in February, XME has fallen through prior support and is now approaching this past year’s lows. The S&P Oil and Gas Exploration and Production ETF (XOP) and the S&P Retail ETF (XRT) are a similar story. After trading sideways for most of this month, XOP gapped lower on Thursday falling through support established at multiple points earlier this year. The S&P Retail ETF (XRT) has a comparable chart pattern. For XME, XOP, and XRT, the 52-week lows are the next critical support level to watch. Start a two-week free trial to Bespoke Institutional to access our interactive Chart Scanner and much more.