Consequently, Worth believes that XLE could dip to prior lows, or fall to about $71.7 – the fund’s previous January lows, pointing to a breakdown in short- and long-term trends. Specifically, the technical analyst said the ETF has broken below its long-term, five-year trend-line.
XLE is currently trading at 4.2% below its 200-day simple moving average and 3.2% below its 50-day simple moving average.
“The conclusion is that energy stocks as a group, as a theme, as a sector are likely to continue to underperform the overall market—just as they did last week, last month, the past two months, 12 months, two years and five years,” Worth said.
Energy Select Sector SPDR
For more information on the energy sector, visit our energy category.
Max Chen contributed to this article.