This chart of the SPDR Energy has some interesting patterns. First are the from March 23 and 25: an and then a normal . Both of these are bottoming patterns, which were confirmed when prices bounced in following sessions.
Next, notice XLE’s tight range as it holds $49. That level is also interesting because it was the weekly low immediately after another bounce in early March.
Third, consider the peak around $54 last month. That matched the close on February 21, 2020, immediately before the coronavirus crash. It’s not a surprise that level would offer resistance after XLE doubled from the lows.
But now the sector could make another stab at a breakout – especially as travel resumes in coming months. Cruise and airline restrictions have already been eased. Memorial Day’s on May 31. Just two weeks after that, California reopens fully.
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