Retail ETF Breaks Out To New Highs, But Should You Buy It? (XRT)

retail stocks

From Dana Lyons: A popular retail ETF just broke out to all-time highs – but is the breakout for real?

Among the many sectors enjoying a strong day yesterday was retail stocks. In fact, after many years of lagging performance, yesterday put a bow on a nice comeback story for the space of late. At least, that may be the conclusion drawn from yesterday’s action in a popular retail ETF, the Retail SPDR (ticker, XRT). We say that because after a 3-year trading range, the XRT finally broke out yesterday to a new all-time high, eclipsing its former highs from 2015 around the $51 level.


While it looks pretty on the chart, the question is will the breakout be sustained? We have observed, in recent years, the tendency for stock breakouts to fail more times than not – at least in the near-term. Will that be the case here? It remains to be seen, but we’re already seeing XRT pull back by as much as 3% this AM.

So are we playing this breakout – and if so, how? In a Premium Post at The Lyons Share, we detail our game plan for this sector, including the key levels to watch on the XRT.

If you’re interested in the “all-access” version of our charts and research, please check out our new site, The Lyons Share. You can follow our investment process and posture every day — including insights into what we’re looking to buy and sell and when. Thanks for reading!


Disclaimer: JLFMI’s actual investment decisions are based on our proprietary models. The conclusions based on the study in this letter may or may not be consistent with JLFMI’s actual investment posture at any given time. Additionally, the commentary provided here is for informational purposes only and should not be taken as a recommendation to invest in any specific securities or according to any specific methodologies. Proper due diligence should be performed before investing in any investment vehicle. There is a risk of loss involved in all investments.

The SPDR S&P Retail ETF (XRT) was unchanged in premarket trading Thursday. Year-to-date, XRT has gained 11.98%, versus a 6.01% rise in the benchmark S&P 500 index during the same period.

XRT currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #4 of 42 ETFs in the Consumer-Focused ETFs category.

This article is brought to you courtesy of Dana Lyons, JLFMI and My401kPro.