The Regional Bank SPDR (KRE) and the Homebuilders SPDR (XHB) have been leading the market higher since early October. Both bottomed with the October 3rd close and surged over 20% the last five weeks. Also notice how these two are moving step-for-step. KRE is red and XHB is black. Strength in these two groups is very positive for the broader market. The Correlation Coefficient shows a strong positive correlation.
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About the author:
Arthur Hill, CMT, is the Chief Technical Strategist at TrendInvestorPro.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London.
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