Preface to all four parts: This weekend, I’ve taken some favorite exchange-traded funds (ETFs) and broken them into groups. I’ll share a few thoughts about each of these below, and as always, clicking on any chart will make it fill your screen, whatever size that may be.
Let’s look at some specific sectors. The first is a favorite, which is the homebuilders. It has been in an ascending channel for many years, and it has completed a remarkably good topping pattern within the confines of that channel. I believe it could get as low as the lower trendline, ultimately.
Another real estate oriented fund is, of course, our old friend IYR, which has an exceptional topping pattern. The analog is not in place anymore, but only for the best of reasons – – – the fact that the present topping pattern is vastly better (and thus no longer analogous) to the former.
Regional Banks have broken their uptrend and have likewise finished a topping pattern. It isn’t the cleanest in the world, but it isn’t bad.
A similar fund, this one for the big banks, has a superior topping pattern.
Lastly, the Consumer Discretionary fund has muscled its way higher, but only to accomplish the reach for major resistance, which I believe will hold fast, leading to a hard fall in price.
