EarningsBeats.com Digest for September 27, 2021
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Consumer Discretionary Groups Looking Strong
As we approach Q4, consumer discretionary (XLY) stocks appear to be gaining momentum. The key price resistance level is at 185, which we failed to break last week, but short-term momentum definitely has turned more bullish, so I wanted to focus on a few key industry groups that could benefit from further strength in the XLY:
On an absolute basis, the XLY has been holding its trendline beautifully, as you can see from the chart above. The AD line set a new high on Friday and price action, while failing to clear 185, did still manage to close at an all-time high. I highlighted four industry groups helping to drive the XLY to new highs. Hotels ($DJUSLG), specialty retail ($DJUSRS), travel & tourism ($DJUSTT), and automobiles ($DJUSAU) are all showing absolute
strength and could be leaders as we move into Q4. Should these industries continue to push higher, I'd begin to look for component stocks to report better-than-expected earnings results.
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Tom Bowley
Chief Market Strategist
EarningsBeats.com
Better Timing. Better Trades.
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