XLI finds buyers at key support level
Industrial Select Sector SPDR ETF (XLI) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, XLI finished the week 1.18% higher at 84.64 after edging lower $0.11 (-0.13%) today on low volume ahead of tomorrow's Presidents' Day market holiday. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (XLI as at Feb 14, 2020):
Friday's trading range has been $0.59 (0.7%), that's below the last trading month's daily average range of $0.89. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for XLI.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 84.30 earlier during the day, the market bounced off the key technical support level at 84.40 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on Tuesday, XLI gained 0.94% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 85.33 where further buy stops might get triggered.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for XLI. Out of 419 times, XLI closed higher 57.28% 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 60.38% with an average market move of 0.56%.