SPDR Select Sector Fund - Consumer Staples

Crash Incoming 6?

Updated

Usually Consumer Staples, a risk-off sector, has an inverse correlation with the S&P500 . In this chart, strong uptrends in the XLP / SPX (blue line) coincides with S&P500 (green line) corrections or crashes (circles). There is a possibility that the bottom of the XLP / SPX was the below white line in the chart, while the top one, a historically strong support/resistance , could have a significant role in the following weeks or months. If this white line is broken in the future, it could mean, in the worst case scenario, the confirmation of a bear market or a crash.

Again, lines in the sand, nevertheless, I believe this are times to be extra careful.

(This idea was developed based on a Game of Trades analysis).

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The same chart with candles instead of the blue line price.

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Update the chart, going up to resistance again.

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Careful, even today, for now a green day, we can barely see a clear rejection of the resistance line. Let's see what is going to happen tomorrow.

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Well, sooner than I expected... it's breaking:

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Probably we can confirm the breakout:

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I hope you have been following this indicator, it's working perfectly (wait for the trend reversal, until then, patience and DCA accordingly):

Good luck!

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Remember... XLP / SPX is still in a uptrend, until we see a clear change in this trend markets will continue to go down:

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A more precise approach of this chart... After reaching the white line, now support, there is a possibility that XLP/SPX will go, at least, towards the yellow line. But maybe only the red resistance line could be the next strong inflection point for the S&P 500. With these possibilities in mind to manage my short positions I will wait to long any asset, except for TLT; based on my last 'crash' idea, after the consolidation, it could start its way up in the following weeks (nevertheless, as always, it will be a very cautious buy).
Today, BTC (crypto) started a strong pullback and, generally, at least in the last months, this market anticipates the traditional markets moves. Futures are already down, but this means that strong pullbacks of the S&P 500 and the Nasdaq could be a very likely possibility.
Stay well...

SometimesLosing

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