Groovy Consumer:
The discretionary group has been on a roll lately. And it has been broad based if you will as both the XLY and XRT have been on the ascent. The daily chart of the XRT below shows smooth overall action and remaining above the cup with high handle pivot, which can also be interpreted as a bull flag. As well as the XLY has acted, notice that the XRT, the more “equal weight” fund has outperformed the XLY over the last 6 months. On the MONTHLY chart (notice the bearish shooting star at the very round par number in November 2021), one can see why I feel there is still some runway left as this could play catch up to the overall market. The S&P 500 which is now at all-time highs has left the XRT in the dust. Of course, one could say that there is a reason why it has underperformed, and that is a valid point, but as long as this can remain above the daily cup with high handle pivot remain constructive. TSLA which we have spoken about before seems to be finding its footing, and it is by far the second-largest holding in the XLY, and it will have some headwinds here as it looks to fill the upside gap, which would also be the top of the range in a bearish rising wedge. It is a good start that trade is tightening up at the very round 200 number and a move above the 50-day SMA near 210 as PRICE catches up and this could fly.