Copper Strength Propelling Basic Materials ETFs (XLB, IYM) Higher

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October 5, 2017 11:04am NYSE:XLB


From Chris Kimble: Many are of the opinion that what Doc Copper does, can send an important price message about the strength or of lack of in the overall economy. Doc Copper is important to keep a close eye and how Basic Materials stocks are performing can be important to keep aware of.

Below looks at Basic Materials ETF (XLB) over the past few years:

Ascending triangles are rewarding patterns to find in bulls markets, as this pattern breaks to the upside two-thirds of the time. This pattern also helps with risk management, as it helps one apply stops, should the pattern fail to break out, which it does one-third of the time.

Below looks at a different Basic Materials ETF (IYM):

Strength in Doc Copper, XLB and IYM often times is a good sign for the macro economy. If both of these would continue higher, it could send a concerning message to bond hold holders. The global growth story wants/needs to see both of these continuing to head higher.

If you would like to receive weekly Power of the Pattern thoughts on Copper and the Basic Materials sector, we would be honored if you were a Metals or Sectors Member, as we update both memberships on these patterns each week.

The Materials Select Sector SPDR (XLB) was trading at $57.81 per share on Thursday morning, up $0.13 (+0.23%). Year-to-date, XLB has gained 17.23%, versus a 14.61% rise in the benchmark S&P 500 index during the same period.

XLB currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #3 of 30 ETFs in the Industrials Equities ETFs category.

This article is brought to you courtesy of Kimble Charting Solutions.

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