(This is an excerpt from today's DecisionPoint Alert report on DecisionPoint.com)
Today's giant drop in the Energy Sector (XLE) was enough to negate a very young Long-Term Trend Model (LTTM) BUY signal. That LTTM SELL signal was generated when the 50-EMA sunk below the 200-EMA. With oil and gas producers Exxon-Mobil (XOM), Chevron (CVX), ConocoPhillips (COP), Phillips (PSX) and Occidental Petroleum (OXY) taking up over 50% of the capitalization on XLE, I wasn't surprised to see the drop. USO dropped .75% and I'm sure this could have affected these big companies. With price dropping well below the 200-EMA, I am expecting this LT Trend Model SELL signal to remain in effect. I would look for price to drop and test the November/December lows. Notice the confirmations on all of the major indicators to the downside.
As investors, we want to accomplish two basic things: (1) Determine the trend and condition of the market and (2) select stocks that will ride that tide. The DecisionPoint Alert helps with the first step, and DecisionPoint Diamonds helps with the second. Go to DecisionPoint.com and SUBSCRIBE TODAY! (Charter Subscriber Discounts Available!)
Things were really looking up for XLE. A declining trend was broken and price had managed to overcome resistance at the 43-week EMA. The weekly PMO was just entering positive territory. Today, the PMO has topped and price dropped below both the 17/43-week EMAs. I would look for a test around $55.
Technical Analysis is a windsock, not a crystal ball.
Happy Charting! - Erin
Email: erin@decisionpoint.com
Erin Swenlin will be presenting at the The MoneyShow Las Vegas May 11-13, 2020! You'll have an opportunity to meet Erin and discuss the latest DecisionPoint news and Diamond Scans. The conference is free to attend or view online!
