The Energy Select Sector SPDR (NYSEArca: XLE), the largest energy ETF, “was in a four-week pause until rallying Nov. 14 (see Chart 1). It is now less than 4% below its all-time high, set in near the peak of the oil bubble in May 2008, when the commodity traded above $141 per barrel,” reports Michael Kahn for Barron’s.

Kahn goes on to note “Another positive is simply the rising trend itself. The ebb and flow of rally and pullback is orderly and the pullback seen over the past few weeks was quite shallow. This suggests the traders were not as interested in taking profits from the last rally leg. It is another sign of demand.”

XLE allocates a combined 30% of its weight to Exxon and Chevron (NYSE: CVX), also an integrated oil company. The ETF is up 9% in the past 90 days. Of the four other oil and gas producers in XLE’s top-10 holdings, three do not have downstream operations, meaning they are not integrated firms.

Energy Select Sector SPDR

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