Consumer Staples: Technical Weakness Continues

Close to a month ago, on December 5th, we presented a timing model showing the consumer staples sector at a high relative to its 50-day moving average (click here for previous post). So far the sector has ended 2007 and begun 2008 with back-to-back declines in excess of 1%. The sector did continue slightly higher after this post, but the chart below highlights three previous peaks based on the same model.

Currently the sector is breaking below its 50-day moving average for the first time since September 10th. Its previous close was 295.48, and a decline to the low would put it at a level of roughly 288. MO (-$2.48), KFT (-$2.35), KO (-$1.66), and WMT (-$1.29) have led the 2% decline in the sector since 12/5/07. The S&P 500 is down only 1% in the same period.