FYI, Mr. B. P. UVEK Is Not Cracking the Market: Sector Review Part II – Daily

In the earlier review of the SPDR sector funds from the weekly charts (link below) there were some cracks that appeared in the foundation of the uptrend, but not enough to derail it yet. Zooming in to the daily charts expands the spectrum of the sectors to see all colors of the rainbow up close. Where Mr. Roy G. Biv is used as an acronym by school kids to remember the colors of the rainbow, a similar tool can be used to describe the spectrum of sector funds and where those cracks might get bigger first.

FYI

The first group is the Financials Select Sector SPDR,$XLF, Consumer Discretionary Select Sector SPDR,$XLY and Industrials Select Sector SPDR,$XLI sectors, FYI. This group of charts are far and away the ugliest. Using the XLY chart to illustrate, there is not much good to look at. only that the Simple Moving Average’s (SMA’s)are rising. Even there the 20 day SMA has moved below the 50 day SMA.

Consumer Discretionary Select Sector SPDR,$XLY

The Relative Strength Index (RSI) is falling and the Moving Average Convergence Divergence (MACD) indicator is waning and about to cross negative. Finally it printed a very large bearish engulfing candle on Friday and has moved lower on increasing volume. This is the same story for the XLF and XLI. These sector funds are poised to move lower next week.

Mr. B.

The Materials Select Sector SPDR,$XLB, stands alone in the next group. Mr. B. has a lot of the same characteristics of the FYI group, but is not quite as bad.

Materials Select Sector SPDR,$XLB

It printed a big bearish engulfing candle Friday and also has an RSI that is falling and a MACD that is waning, although a bit further away from crossing. It is also still much higher in the Bollinger bands and the pullback late in the week happened on decreasing volume.

P.

Consumer Staples Select Sector SPDR,$XLP, the P., has been the strongest sector recently. It did print a bearish engulfing candle on Friday but has been in a straight upward move for the last 3 weeks. A little pullback would be healthy.

Consumer Staples Select Sector SPDR,$XLP

It is still in the top of the Bollinger bands and has a positive and relatively flat MACD, with an RSI that grazed the technically overbought line and has had a minor pullback. Finally all of the SMA are sloping higher and have not crossed since October.

UVEK

This final group is relatively strong but not quite as much so as the XLP. It contains Utilities Select Sector SPDR,$XLU, Health Care Select Sector SPDR,$XLV, Energy Select Sector SPDR,$XLE and Technology Select Sector SPDR,$XLK, UVEK. As illustrated by the XLK chart, this group has printed bullish flags over the last one to two weeks.

Technology Select Sector SPDR,$XLK

The candles Friday all had bearish aspects to them, but remained with in the flag. The major bearish issue for these sectors is the now diverging RSI and MACD. the RSI is falling and the MACD waning for each of these sectors, despite the bull flag in the uptrend. They are not yet reversing but might be on the edge. Watch them. For now it is the FYI group that is cracking but if the last group resolves their flags lower then Mr. B. P. UVEK will be cracking the market.

Your House is Settling Not Falling Apart – Sector Review Part I: Weekly

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