{"id":193378,"date":"2023-07-12T13:33:54","date_gmt":"2023-07-12T17:33:54","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=193378"},"modified":"2024-01-24T12:13:11","modified_gmt":"2024-01-24T17:13:11","slug":"chart-advisor-energy-revives-the-uptrend","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/chart-advisor-energy-revives-the-uptrend\/","title":{"rendered":"Chart Advisor: Energy Revives the Uptrend"},"content":{"rendered":"\n<p><strong><a href=\"https:\/\/www.investopedia.com\/contributors\/54841\/?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=27774019&amp;utm_medium=email\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>By&nbsp;<\/strong><\/a><strong><a href=\"https:\/\/www.investopedia.com\/contributors\/54841\/?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=27774019&amp;utm_medium=email\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>J.C. Parets<\/strong><\/a>&nbsp;&amp;&nbsp;<a href=\"https:\/\/get.allstarcharts.com\/?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=27774019&amp;utm_medium=email\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>All Star Charts<\/strong><\/a><\/strong><\/strong><\/p>\n\n\n\n<p><strong>1\/ Energy Revives the Uptrend<\/strong><\/p>\n\n\n\n<p><strong>2\/ ARKF Makes the Move<\/strong><\/p>\n\n\n\n<p><strong>3\/ Yields and Dollar Diverge<\/strong><\/p>\n\n\n\n<p><strong>4\/ Crude Resolves Higher<\/strong><\/p>\n\n\n\n<p><em>Investopedia is partnering with All Star Charts on this newsletter, which both sells its research to investors, and may trade or hold positions in securities mentioned herein. The contents of this newsletter are for informational and educational purposes only, however, and do not constitute investing advice.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-1-energy-revives-the-uptrend\">1\/ <strong>Energy Revives the Uptrend<\/strong><\/h2>\n\n\n\n<p>Although the&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/e\/energy_sector.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">energy sector<\/a>&nbsp;has been the weakest this year, it continues to demonstrate signs of life.<\/p>\n\n\n\n<p>The Oil &amp; Gas Exploration and Production ETF (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=xop&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">XOP<\/a>) was particularly strong in today&#8217;s session, jumping 2.48%.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/1-6-1100x541.png\" alt=\"\" class=\"wp-image-193379 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/541;\" \/><\/figure>\n\n\n\n<p>As you can see in the above chart, the price has found&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/s\/support.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">support<\/a>&nbsp;multiple times at the November 2021 highs. As long as this level holds, the primary uptrend remains intact.<\/p>\n\n\n\n<p>Also notice that price is pushing up against the&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/v\/vwap.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">anchored volume-weighted average price (AVWAP)<\/a>&nbsp;from last year&#8217;s highs, making it a critical short-term resistance area.<\/p>\n\n\n\n<p>If buyers drive a decisive breakout, XOP could revisit its former highs from earlier this year.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-2-arkf-makes-the-move\">2\/ <strong>ARKF Makes the Move<\/strong><\/h2>\n\n\n\n<p>With the stock market enjoying a solid rally from its lows last year, it was only a matter of time before the most&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/s\/speculativestock.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">speculative<\/a>&nbsp;growth areas started to participate. <\/p>\n\n\n\n<p>Today, the ARKFintech Innovation ETF (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=arkf&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">ARKF<\/a>) rose over 3%, reaching new 52-week highs.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/2-7-1100x541.png\" alt=\"\" class=\"wp-image-193380 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/541;\" \/><\/figure>\n\n\n\n<p>After 12 months of building a bottoming formation, price finally pierced to the upside through the upper bounds of the range as buyers took control.<\/p>\n\n\n\n<p>Notice that momentum, as measured by the 14-day&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/rsi.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">relative strength index (RSI),<\/a>&nbsp;is hitting&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/o\/overbought.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">overbought<\/a>&nbsp;conditions, and a flat-to-upward sloping 200-day moving average is present on the chart. All this evidence suggests that a bearish-to-bullish reversal in the primary trend.<\/p>\n\n\n\n<p>If this new high holds, ARKF could&nbsp;complete this base and kick off a new leg to the upside.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-3-yields-and-dollar-diverge\">3\/ <strong>Yields and Dollar Diverge<\/strong><\/h2>\n\n\n\n<p>The one-two punch that knocked the market on its back last year is out of sync.<\/p>\n\n\n\n<p>We\u2019re talking about the dollar and rates falling out of rhythm and beginning to&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/d\/divergence.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">diverge<\/a>.<\/p>\n\n\n\n<p>Check out the U.S. 10-year&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/t\/treasury-yield.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">yield<\/a>&nbsp;(<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=tnx&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">TNX<\/a>) overlaid with the&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/u\/usdx.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">U.S. Dollar Index<\/a>&nbsp;(<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=dxy&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">DXY<\/a>):<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/3-8-1100x561.png\" alt=\"\" class=\"wp-image-193381 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/561;\" \/><\/figure>\n\n\n\n<p>While neither has made any progress since stocks bottomed last October, the 10-year yield is challenging fresh decade highs as DXY is pressing toward its year-to date lows.<\/p>\n\n\n\n<p>It\u2019s clear that this strong positive relationship is shifting along with the Fed policy that fueled it.<\/p>\n\n\n\n<p>Regardless, stocks don\u2019t seem to mind. In fact, the rise in&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/i\/interestrate.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">interest rates<\/a>&nbsp;supports the rotation we\u2019re witnessing into&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/c\/cyclical_industry.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">cyclical<\/a>&nbsp;value-oriented areas of the market.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-4-crude-resolves-higher\">4\/ <strong>Crude Resolves Higher<\/strong><\/h2>\n\n\n\n<p>Buyers can\u2019t seem to resist energy stocks, as last year\u2019s leadership group led today\u2019s session.&nbsp;<\/p>\n\n\n\n<p>But it\u2019s not only equities. The bid among energy stocks is spilling over in the underlying&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/c\/commodity.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">commodities<\/a>.<\/p>\n\n\n\n<p>Crude oil broke out of a multi-month consolidation today, reclaiming a key level of former&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/resistance.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">resistance<\/a>.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/4-9-1100x561.png\" alt=\"\" class=\"wp-image-193382 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/561;\" \/><\/figure>\n\n\n\n<p>The bias now appears higher for crude despite it remaining within an eight-month range and a bearish momentum regime. As long as crude can hold above $74, the path of least resistance should remain toward its year-to-date highs at approximately $83.<\/p>\n\n\n\n<p>Bigger picture: Energy commodities and stocks rallying in tandem represent a constructive development for global&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/risk-asset.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9652643-20230711&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071123\" target=\"_blank\" rel=\"noreferrer noopener\">risk assets<\/a>&nbsp;and suggest further rotation to come.<\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<p>Originally posted 11th July 2023<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Although the\u00a0energy sector\u00a0has been the weakest this year, it continues to demonstrate signs of life.<\/p>\n","protected":false},"author":186,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21,14,15,16,17,18,6,8,9,22,23,26,3],"tags":[9928,1779,6677,1549],"contributors-categories":[13686],"class_list":{"0":"post-193378","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-commodities","7":"category-etfs","8":"category-fixed-income","9":"category-forex","10":"category-futures","11":"category-macro","12":"category-north-america","13":"category-region","14":"category-securities","15":"category-stocks","16":"category-technical-analysis","17":"category-text-articles","18":"category-traders-insight","19":"tag-arkf","20":"tag-dxy","21":"tag-tnx","22":"tag-xop","23":"contributors-categories-investopedia"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- 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