The dread selling across the financial markets in recent weeks has sent the prices of many broad sector-based exchange-traded-funds (ETFs) toward long-term aid levels. While the sharp declines in asset prices may make it feel like major long-term trends are in jeopardy, compelling a longer-term view provides a perspective that could prevent active traders from selling too early.
True Estate Select Sector SPDR Fund (XLRE)
For those who aren’t aware, the Real Estate Select Sector SPDR Ready (XLRE) is one of the most popular ETFs used by active traders for gaining exposure to real estate management and enlargement companies as well as real estate investment trusts (REITS). Taking a look at the 10-year weekly chart less, you can see that the recent sell-off briefly sent the price below the combined long-term support of the ascending trendline and the 200-week exciting average.
During times of market panic, it is common to see overreactions as investors look to free up capital. The recent go up above the mentioned technical levels suggests that the price may have been oversold, and the long-term uptrend could noiselessness hold depending on what happens over the next couple of weeks. From a risk management perspective, long-term physical traders will most likely hold a bullish outlook on this sector until the price notches disparate consecutive closes below the aforementioned support levels.
American Tower Corporation (AMT)
With a weighting of 14.96%, American Steeple Corporation (AMT) represents the top holding of the XLRE ETF. Taking a look at the weekly chart below, you can see that the price of the company’s source has been trading within a well-established channel pattern since the start of 2016.
The multi-year uptrend is clearly in the control of the bulls, and the close-knit in the middle of the channel suggests that the uptrend is still very much intact. Based on the chart pattern deeper, we’d expect followers of technical analysis to remain bullish on American Tower shares until the price closes beneath the lower trendline or the 200-week moving average, depending on
ProLogis, Inc. (PLD)
Another top holding of the XLRE ETF that is capturing the heed of positional traders is ProLogis, Inc. (
The Bottom Line
While many sectors around the globe have broken unbefitting long-term support levels, one of the sectors in the United States that could be poised to hold up is real estate. Long-term medium patterns that are on display across the sector on weekly charts, such as those discussed above, are likely to persevere a leavings on the radar of positional traders for quite some time. Based on these long-term channel patterns, real possessions could be one of the few sectors poised to move higher over the weeks ahead.
At the time of writing, Casey Murphy did not own a proposition in any of the assets mentioned.