It’s time to take a look at one of my favorite technical filters, our 20-/50-day bullish crossovers. For those of you that may not have seen these posts before, this filter searches our database of more than 7,000 stocks for companies that have recently seen a bullish crossover of their respective 20- and 50-day moving averages.
These crossovers typically happen as a new bullish trend is beginning to emerge, signaling a higher probability that these stocks will continue to pace higher over the intermediate-term outlook.
This week, the stocks on this list are spread among a large group of sectors, though the energy sector is better represented than other industry groups as the energy. This sector (represented well by the XLE ETF) has been on an absolute tear lately, outpacing the S&P 500 Index by a wide margin for the last three months.
Believe it or not, sentiment towards the XLE share has been relatively pessimistic, despite the fact that this ETF is a relative strength leader. This combination of positive technicals and negative sentiment adds up to a short- to intermediate-term bullish outlook for the Energy sector and the XLE.