Churning Or Taking A Rest?

Round number theory is taking the industrial space hostage with the XLI recording four consecutive MONTHLY CLOSES with a 100 or 101 handle in 2023. There is PRICE action to compare this to as from May 2021 through April 2022 was in close proximity to par as well but it was unable to break higher and eventually, it weighed the XLI down. It reached the lower 80s level before a bullish engulfing MONTHLY candle last October put the fund on a northward trajectory. Will it trade sideways for another 9 months as it did previously in ’21-’22? That would not be a shocker as it had been in the 100 area for 6 months now. Bulls can claim the recent digestion was preceded by a powerful October-November 2022, but the bears could state the lack of any follow-through and spinning top candles the last 3 months which indicates fatigue. RTX and HON, the top 2 holdings in the XLI, are battling with the 200 and 100 figures. Will be interesting to witness how they act around them going forward into the end of the first half of 2023.

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