XLE pushes through Tuesday's high
Energy Select Sector SPDR Fund (XLE) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
XLE finished Wednesday at 33.94 surging $1.31 (4.01%) on high volume. This is the biggest single-day gain in over a month. Closing above Tuesday's high at 33.39, the ETF confirmed its breakout through the prior session high after trading up to $0.99 above it intraday.
Daily Candlestick Chart (XLE as at Sep 16, 2020):
Wednesday's trading range has been $1.74 (5.29%), that's far above the last trading month's daily average range of $0.87. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for XLE.
One bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on August 28th, XLE actually lost -2.17% on the following trading day.
Unable to break through the key technical resistance level at 34.24 (R1), the market closed below it after spiking up to 34.38 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. XLE found buyers again today around 32.64 for the third trading day in a row after having found demand at 32.53 in the previous session and at 32.48 two days ago.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Closed above last periods high" stand out. Its common bullish interpretation has been confirmed for XLE. Out of 360 times, XLE closed higher 50.56% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 58.06% with an average market move of 0.17%.