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Weak Materials About To Break Dual Support?

Published 08/17/2015, 12:00 PM
Updated 07/09/2023, 06:31 AM

S&P 500 Sector Performance

The above table looks at the 9 S&P 500 sectors' performance on a variety of time frames. Today I'm taking a look at the Materials sector. As you can see, (NYSE:XLB) is the second-worst sector this year, only trailing the hard-hit energy complex.

Could it get worse? The chart below looks at XLB and what could be a very important price point right now.

Materials Select Sector SPDR

As you can see, XLB is testing dual support right now and is below its 200-Day moving average.

Even though this sector has been weak of late and this year, if dual support gives way, selling pressure could ramp up. Humbly I feel what materials do from here matters from a micro- and big-picture perspective.

What might do well if XLB breaks support? Bonds could be a beneficiary should it happen.

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