XLU climbs to highest close since June 10th
Utilities Select Sector SPDR Fund (XLU) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
XLU ended the month 7.8% higher at 60.83 after edging higher $0.10 (0.16%) today. Today's close at 60.83 marks the highest recorded closing price since June 10th. Trading up to $0.59 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing above Thursday's high at 60.74, the ETF confirmed its breakout through the previous session high after trading up to $0.25 above it intraday.
Daily Candlestick Chart (XLU as at Jul 31, 2020):
Friday's trading range has been $1.01 (1.67%), that's slightly below the last trading month's daily average range of $1.14. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for XLU. Prices continued to consolidate within a tight trading range between 59.98 and 60.99 where it has been caught now for the last three trading days.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar.
Prices are trading close to the key technical support level at 60.72 (S1). After having been unable to move lower than 59.99 in the prior session, XLU found buyers again around the same price level today at 59.98. The last time this happened on July 21st, XLU gained 1.54% on the following trading day.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to previous low" stand out. Its common bullish interpretation has been confirmed for XLU. Out of 519 times, XLU closed higher 56.45% 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 58.57% with an average market move of 0.39%.