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XLK Weekly: The Relief Rally From The March Low Stalls At 92.14s, Look Out Below

Sharedata Futures profile picture
Sharedata Futures


  • A gap higher open in Monday’s trade saw a rally phase to 90.56s into Tuesday’s auction.
  • A pullback developed to 88.08s before the rally resumed to 92.14s where buyers trapped.
  • A pullback developed to 88.56s into the week’s end.
  • From a structural perspective, the highest probability path near-term is sell-side, barring failure of 91.63s as resistance.
  • Bullish breadth resumes decline from the bullish extreme zone.

In this article, we examine the significant weekly order flow and market structure developments driving NYSEARCA:XLK price action.

As noted in last week’s XLK Weekly, the highest probability path for this week was buy-side, barring failure of 86.50s as support. This primary expectation did play out as buying interest near last week’s resistance drove price higher to 92.14s into mid-week. Buyers trapped there, halting the rally before driving price lower to 88.65s ahead of Friday’s close, settling at 88.63s.

XLK Weekly Auction 24Apr20

27 April-01 May 2020:

This week’s auction saw a gap higher open in Monday’s auction as last Friday’s late buyers held the auction. A rally ensued, driving price higher to 89.69s where buyers trapped as balance developed, 89.69s-88.86s, into Monday’s close. Buy-side continuation unfolded early in Tuesday’s trade, achieving a stopping point, 90.56s, where sellers trapped. A pullback ensued where selling interest emerged, 89.11s, before achieving the weekly stopping point low, 88.08s, into Tuesday’s close.

Tuesday’s late sellers failed to hold the auction as a gap higher open formed in Wednesday’s auction as additional sellers trapped, driving price higher, achieving the weekly stopping point high, 92.14s, where buying interest emerged into Wednesday’s close. Wednesday’s late buyers failed to hold the auction as a pullback ensued in Thursday’s trade to 90.72s before selling interest emerged, 91.32s on the uptick into Thursday’s close. A gap lower open developed in Friday’s auction as a pullback ensued, achieving a stopping point, 88.56s, ahead of Friday’s close, settling at 88.90s.

XLK Weekly Auction 01May20

This week’s auction saw key support, 86.50s, hold early week as the rally phase continued to 92.14s. Buyers trapped there, halting the rally as a pullback ensued to 88.56s into week’s end. Within the larger context, it is likely that the market has formed its retracement high following the breakdown below January support, 94.71s.

Looking ahead, the

This article was written by

Sharedata Futures profile picture
Historical Data Mining & Visualization for NYMEX energy markets. Our experience derives from the proprietary trading world involved in US Index derivatives, commodity ETF derivatives, and exchange-traded NYMEX WTI derivatives.Futures trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (4)

MauiJim95 profile picture
The markets went sideways last week. Unemployment is still getting worse. I’m guessing S&P needs at least another 10-15% down & a clear bottom to get us in a real recovery mode. Unemployment recovery will lead this. That means ALL states have to participate.
Sharedata Futures profile picture
@MauiJim95 Thanks for reading and your observations!
My cost is 88.36. Looking to add more but worried about market taking another turn down after the V bouce we have. If I could pick some up realistically in the high 70's low 80's I'd be pretty happy. 200 moving is like 85.
Sharedata Futures profile picture
@Bull_Investor Thanks for reading and your input!
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