XLE Confirms a Bear-Trap Low Established on Dec 21

Below is what we discussed Tuesday morning about Energy Select Sector SPDR ETF (XLE), which has since confirmed a bear-trap low at 58.21 exhibited by the absence of follow-through weakness from new low territory, and by upside-reversal strength Tuesday, and so far today.

While I do not as of yet have signals to add to my long position, the action in XLE is promising. MJP 12/23/15

On Dec 8, our Model Portfolio entered an initial 25% long position at 61.85. Stop protection is placed at 58.70 Close Only. The Close Only Stop survived Monday's break- down to a new intraday low of 58.21 (close at 58.85). This morning's strength so far is a very constructive sign after yesterday's failure to follow through to the downside in reaction to a break of the Aug 24 low at 58.74. That said, however, XLE needs to climb above 62.70/75 to trigger confirmation that a near-term low has been established. MJP 12/22/15