Always consider hidden risks
The Energy Sector (XLE):  Too Bullish ?
October 19 ​( From TradingView  )
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​​​​​The Situation

On October 22, a Death Cross happened on ​The Energy Sector ETF ( XLE ). It's simply
​a pattern in which the short-term 50-day moving average crosses below the longer-term
​200-day moving average and quite a bear sign indeed.
( See first chart below )

XLE ETF 20 DMA ( Day Moving ​Average - Yellow Line - Chart Below ) crossed on
​June ​2 ​below the 50 DMA ( Day Moving ​Average - Red Line - Chart Below )​,
​a bad technical sign. Closing price on XLE was 73.23 on July 15.

​​The XLE reached a new low on August 24 at ​57.74: the last time it did
​reach that level ​was on October 4 2011
.​( See first chart below ).

We are within a new uptrend channel that started on September 29
​​​with ​64.65 support and 72.33 as resistance.
( see first chart below )

The XLE ETF  closed above the 20 DMA ( Day Moving  ​Average - Yellow Line - Chart Below ) on October 2 then at 62.97,
​a good technical sign indeed. Also, the XLE ETF closed above the 50 DMA ( Day Moving ​Average - Red Line - Chart Below ) on October 5 then at 65.41.

​​​​And on a ratio basis ( Energy Sector ETF ( XLE ) over the Mighty​ SP500 Index ), the Energy Sector started to outperformed since August 24 and the the 7 DMA on that ratio did turn upward on October 5 . So on a relative basis​​ ( Ratio of the Energy Sector ETF( XLE ) over the Mighty​ SPY SPDR ), we reached level last seen in mid-July 2015.
( See second chart below )​.

One crucial Technical Factor is that we broke a Major Resistance Trendline on October 5 then at 64.27 that started back on May 5 2015. XLE ETF is in a Bottoming Out Phase indeed.  
( See second chart below - Blue Trendline -Ellipse )​.

​​But the most interesting Technical Factor is that Sentiment ( as seen through the SP500 Energy Sector Bullish %  Index ) reached a zone which when occured in the past two years was a short term toppish sign for the XLE ETF.
Toppish short term and bullish long term it looks like...
​​ ​
( See third chart below - Vertical Lines - Ellipses )​

The Energy Sector (XLE): Too Bullish ?  $SPY, $SPX, $XLE #Trading #Investing #xle #SP500
Energy Sector ​ ETF XLE
over SP500 Index
( Blue Line )
21 DMA ( Amber Line )​

SPY SPDR ( Candles )
Energy Sector  ETF XLE
Daily Candles​
20 DMA ( Yellow Line )
50 DMA ( Red Line )​​
SP500 Energy Sector Bullish % Index
7 dma ( Blue Line )​
Energy Sector ETF XLE ( Bottom Panel )