The top five holdings in this ETF are: Apple Inc (AAPL, 14.77% of assets); Microsoft Corp (MSFT, 11.85%); Facebook Inc A (FB, 7.16%); Alphabet Inc C (GOOG, 5.14%); and Alphabet Inc A (GOOGL, 5.11%).
Technology Select Sector SPDR ETF (XLK)
From Momentum Strategies Report
The number of stocks on both the NYSE and the NASDAQ making new 52-week lows for Monday was below 40. This marked the first such occasion that both exchanges had a sub-40 day of new 52-week lows since May 14.
If it continues for a few more days, we’ll have even more proof that the bulls are consolidating their control over the market and preparing to push stocks decisively out of the lateral trading ranges which many of them established in recent months.
For now, investors should continue to keep a portion of their capital in cash but should also do some nibbling among the stocks showing definite signs of relative strength, particularly in the tech sector (the Internet industry in particular). Investors should continue to lean bullish as we head into further into what should be a constructive month ahead.
Traders can purchase a conservative position in the Technology Select Sector SPDR ETF (XLK) after its recent 2-day + higher close above the 15-day moving average. XLK has also made a new high as of June 4 and has a solid relative strength rating as discussed previously.
I’m not recommending a specific stop-loss for this ETF due to its volatility factor and will leave that up to the discretion of the trader according to individual risk tolerance. I’ll continue to rate XLK as a buy and will continue tracking XLK in this report as long as breadth and internal momentum factors for the NASDAQ remain bullish.
Cliff Droke, Momentum Strategies Report, www.cliffdroke.com, 707-282-5594, June 5, 2018