SPX was down since start of 2022 and so far showed -13.79 negative performance however, not all S&P 500 sectors are performing the same ! In fact, some of them specially Energy Sector ( SPN ) is doing great and strongly outperform all other indices (See related idea about SPN VS SPX if interested).
What is drawn is a provided table showing different sectors inside S&P 500 along with their Tickers. Their performance since start of 2022 is also added to third column. 4th column shows their price chart position with respect to 50 days moving average. 5th and 6th columns show if they recently made Death or Golden crosses and if yes when they did. Also , it is worth to note indices were sorted according to their performance from top to bottom.
Many useful information can be extracted from this table. We show some of them as following:
1. Energy Sector strongly outperformed the market ( I believe this great performance is going to continue. See my publication about Crude Oil and Exxon Mobile Company in related ideas for details)
2. Only two sectors (Energy and Utilities) were positive since start of 2022.
3. Only three sectors (Energy,Utilities and Materials) are above 50 days moving average and all other sectors are below it.
4. Only four sectors did not recently make a Death Cross.
5. Only Three Sectors made a Golden Cross and maintained this status.
6. Health Care sector showing kind of side way trend.
7. All sectors which made a Death Cross has equal or more than -10% negative Performance.
What can be inferred for sector selection and stock picking? There are some clues which can be added to other criteria to make our trades and investments stronger. Some of clues are as below:
1. If we want to avoid the risk, we have to avoid taking long positions in the sectors which are below 50 Days MA.
2. If we are going to (( Buy the Dip )), we can investigate stocks in the sectors with most negative performance. I can suggest Consumer Discretionary at the upcoming new low for example.
3. We have to avoid taking position in side way trends which is Health Care in our study. We can immediately take position in the direction of the trend once it reveal it’s upcoming path.
Please note this information can be used for initial filtering. There are so many other tips and guides to choose stocks and defining buy/sell point for a specific stock. As always, We do not jump blindly into the trade.
Hope this publication to be useful and wish you all the best.
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