Consumer Staples & Discretionary Are Sending a Message to 'Respect'

May 11th, 2013

by Chris Kimble

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Consumer Discretionary and Consumer Staples ETFs have been white hot over the past 5 years. The table below reflects that Staples (XLP) has gained over twice and Discretionary (XLY) three times as much as the S&P 500 over the past five years. No doubt these two have played a major role in pulling the S&P 500 up over 145% since the March 2009 low.

Are XLY and XLP reflecting relative strength and leadership? You bet!

The chart above reflects that XLY and XLP are both facing a duo of resistance lines at (1), drawn off the most emotional high points that date back as much as 10-years.

Does this mean the rallies have to end? Nope.

Should an investor "Respect" that the resistance at (1) and that "Eiffel Tower Patterns" could well impact the future prices of these leading white hot ETF"s? YES!

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