Below we provide our six-month trading range charts of the S&P 500 and its ten sectors. For each chart, the blue shading represents the sector's "normal" trading range, which we consider between one standard deviation above and below the 50-day moving average. The red shading and above is considered "overbought" territory (more than one standard deviation above the 50-DMA), while the green shading and below is considered "oversold" territory (>1 standard deviation below the 50-DMA).
After trading into oversold territory for the first time since last August, the S&P 500 has quickly recovered since its recent low on March 16th. While the index has yet to take out its prior highs and reconfirm the bull market, it is already right back at overbought territory as of this morning.
Below is a table that essentially summarizes what you'll see in the sector trading range charts. As shown, five of ten sectors are now back into overbought territory, while just one (Energy) was overbought last week at this time.
Four sectors have now rallied enough to take out their February highs -- Energy, Health Care, Consumer Staples, and Telecom. Based on its chart pattern, Telecom (which includes the surging VZ) has had the most impressive run in recent days. Eight of ten sectors are back above their 50-day moving averages as well. The only two sectors that remain below their 50-days are Financials and Technology. Both have bounced off of their lows, but neither look particularly attractive.
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