Technology In 3 Charts: Its Not Good

Published 06/21/2017, 03:17 PM
Updated 07/09/2023, 06:31 AM
XLK
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1) The new all-time high in XLK established on Friday June 9 followed by a high-volume key downside reversal remains the dominant feature of the post-November upleg and was accompanied by a glaring upside momentum divergence that serves as a warning signal indicative of upside price exhaustion.

2) All of the action since June 9 has carved out a sideways digestion pattern beneath the cresting 20-day MA, usually a harbinger of approaching downside price continuation.

3) A sustained breach of key support between 55.10 and 54.80 will have the potential to unleash the most serious correction in XLK in the past year — since its pre-Brexit weakness. Only a climb above 56.35 will neutralize the developing negative setup.

Technology Select Sector SPDR ETF

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