“Material” Gains:
Nice returns have accompanied the materials group with top 5 performances on both a one-week and one-month look back period among the 11 major S&P sectors. The WEEKLY chart below shows the recent 6-month digestion breaking to the upside after a 10-week win streak between weeks ending 1/26-3/29 (notice the consolidation began with the bearish evening star completed the week ending 4/12 that slumped more than 3%). There was a brief break above 4 weeks back then back into the pattern, before thrusting out of it leaving bears exasperated. The last time that occurred was in late 2024 with a “failed breakout” which reversed and started the 10-week win streak earlier this year. Deja vu? The MONTHLY chart displays a nice cup base breakout above 85 that suggests a measured move to 105 is in the cards in the near term (September is looking for back-to-back bullish hammer candles). The DAILY chart did record a bearish engulfing candle Wednesday, and perhaps a move back to fill the gap from Monday makes sense. Let’s see how it acts there as the last one to do that after a nice push on 8/1 witnessed a bit of a drawdown.