Utilities Sector (NYSEARCA:XLU)
Utilities ($XLU) has been one of the stronger performing sectors YTD, clearing its 2015 high back in May. It’s A-D Line has created almost a straight line higher as individual utility names retain their up trends.
Health Care Sector (NYSEARCA:XLV)
The Health Care ($XLV) sector still sits below its high but has recently broken above a level of resistance around $73. The A-D Line for the sector has been leading price higher, having already made a new high.
Consumer Discretionary Sector (NYSEARCA:XLY)
The Consumer Disc. ($XLY) sector is just under its prior high but its breadth has already broken out.
As you can see, from a market breadth perspective using the S&P 500 sector’s individual Advance-Decline Lines, the market appears to be much healthier than what the macro economists would lead you to believe. I understand profit margins are contracting, margin debt is high, Europe is falling apart, etc… But there is a difference between economies and markets, and we’re seeing a clear separation when looking at S&P 500 market breadth. And we’re seeing much of the same thing when looking at S&P 500 sector strength and respective breadth indicators.
While it’s possible we see the market digest these gains and see some type of back-filling, it’s hard to argue that the current up trend is anything but strong based on the underlying market breadth strength across the S&P 500 sectors.
Thanks for reading and have a great rest of your week.
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