XLF pops to highest close since December 3, 2018
Financial Select Sector SPDR Fund (XLF) Technical Analysis Report for Feb 13, 2019 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, XLF finished Wednesday at 26.20 gaining $0.07 (0.27%). Today's close at 26.20 marks the highest recorded closing price since December 3, 2018. Trading $0.18 higher after the open, the ETF was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on January 29th, XLF actually gained 0.58% on the following trading day. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (XLF as at Feb 13, 2019):
Wednesday's trading range has been $0.24 (0.91%), that's below the last trading month's daily average range of $0.32. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly lower than usual for XLF.
One bearish candlestick pattern matches today's price action, the Shooting Star.
Prices are trading close to the key technical support level at 26.11 (S1).
While the market is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "3 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for XLF. Out of 149 times, XLF closed higher 54.36% 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 61.74% with an average market move of 0.72%.