David Vs. Goliath:   

Inside the vast consumer discretionary space, there are two dominant ETFs. One is the XLY which is very top-heavy and reliant upon AMZN and TSLA (the former is looking to surpass GOOGL as the 5th largest company on the planet and exceed $2T). Amazon has been reluctant to give up any ground at the 180 number which was a bearish gravestone doji candle from 3/4 (3 of the last 4 sessions were above 180 intraday but zero CLOSED above it). It has been displaying bearish RSI divergence since February. TSLA continues to swim below its 50 and 200-day SMAs since 1/11 and is the primary reason why the XLY is underperforming the XRT. The chart below of the XRT shows it honing in on another bull flag base as the top 3 holding in GPS DKS and GES all acting very confidently and each representing less than 2% of the fund. On a YTD basis, the XRT is higher by 8% while the XLY has risen “just” 3%. Concerning how the XRT will act against the XLY will likely be determined by TSLA, and today it did recapture its 21-day EMA and may go on to fill in the upside gap from the session, but there it will have to contend with the downward-sloping 200-day SMA. 

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