Consumer Discretionary is coiled for a move. $XLY – May 2, 2023


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This is Scott with your Chart of the Day. I want to take a look at XLY ( NYSEARCA: XLY ). This is the Consumer Discretionary ETF ( NYSEARCA: XLY ), at least one of them that I follow.

I think this chart is in an interesting spot here because as you can see the moving averages are starting to pile together. They are as close as they have been in many years.

If I zoom out here you can see all the way back to 2020, 2019, these moving averages have not really been this close together since all the way back here, really kind of in 2019, where they were kind of stacked a little bit.

Even here, it kind of stacked but we haven’t had moving averages this close in a while. So that is interesting to me because, typically, that can either be a really strong floor of support or a really strong ceiling for consolidation and resistance.

And so I want to see how price acts around this area. If I bring out my little drawing tool you can see where we’re tightening up as these moving averages are coming closer together. They are just pinching here in the price action.

Now, there are a bunch of stocks within the XLY ( NYSEARCA: XLY ) that do have earnings that could potentially make or break this base. They could either break it to the upside or break it to the downside.

So I want to see how this acts with earnings. But I think this is a very interesting “tell” for this space and this sector, especially with everyone screaming about a recession. So definitely one we are watching over at

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