Notable is the fact that February marks the start of a multi-month stretch that is considered the seasonally strong period for the energy sector.
However, there are other factors to consider, chief among them that the technical outlook for XLE is not 100% convincing.
“There is one technical negative staring at us. Barring an immediate sharp jump higher, the ETF is about to experience a bearish moving-average cross: The 50-day average could drop below the 200-day average. It’s what chart watchers call a ‘black cross’ or ‘death cross,’ and it’s supposed to tell us that the overall trend is changing from up to down, although it is not a guarantee,” according to Barron’s regarding XLE.
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