Score 8.8 (out of 10): TECHNOLOGY SELECT SECT SPDR poised to rally +11.6% rally in 3 months

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What’s Going On Here?

Technology companies are being re-evaluated as US interest rate hikes are being priced in as well as expectations for the Fed’s balance sheet adjustment is expected to begin shortly. Based on our data analysis, on a 3 months view, the Tech sector could still surprise on the upside.

Why Now?

TECHNOLOGY SELECT SECT SPDR has reached a new medium term low. Previously, during similar occasions, TECHNOLOGY SELECT SECT SPDR shares had a median return of +11.6%, over the following 3 months based on 8 historical occasions with 7 of those showing positive returns (88% hit ratio). This buy signal for TECHNOLOGY SELECT SECT SPDR received a high score of 8.8 (out of 10). This insight was generated on 2022-January-18 with last price of 161.78.

What’s This Company About?

TECHNOLOGY SELECT SECT SPDR is in the Sector Fund-Technology business. Based on the last 2 years’ risk/return profile, this asset is seen as Less Risky. Ticker symbol: XLK US.

What’s My Risk / Reward and Time Horizon?

We found 3 months to be the optimal trade horizon, after testing a number of possible alternatives (accuracy of previous returns). Otherwise consider closing out this trade once the target level of 180.6 (+11.6%) has been reached. Based on TECHNOLOGY SELECT SECT SPDR’s recent up and down swings, LongShortBets suggests considering to set a stop loss level for this insight at 159.28 (last price at 161.78), which is equivalent to a -1.5% decline.

Returns during similar periods:

The chart above shows the previous returns (in %) based on similar setups with the most recent ‘insight’ shown under (1), the second most recent ‘insight’ shown under (2), etc. 

Previous episodes:

18.5% (October-2021), 11.3% (March-2021), 10.3% (February-2020), 10.6% (May-2019), -8.8% (October- 2018), 12.9% (February-2018), 12% (November-2016), 14% (June-2016).

Historical Chart:

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Summary:

NameTECHNOLOGY SELECT SECT SPDR
ViewUp
Star (1 to 10)8.8
Target+11.6%
Time3 months
Hit Rate88%

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