Charts indicate that this major ETF housing Meta and Disney is poised for a new breakout

The Communications Services Select SPDR ETF (XLC) is making waves in the stock market this year, with strong bullish patterns and breakouts leading to significant gains. Home to major companies like Meta, Alphabet, and Disney, XLC has broken out of eight bullish patterns on the daily chart already, with the potential for more to come.

In a recent analysis, it was pointed out that XLC has been following a consistent upward trend since its 2022 low, riding an upward sloping trading channel similar to its trajectory from spring 2020 to summer 2021. However, a major reversal occurred in September 2021 when Meta’s stock plummeted, impacting XLC’s performance negatively for a period.

Related:  Today's Bitcoin (BTC) News: Silk Road BTC Sales, Federal Reserve Update, and ETF Market Flows

On the flip side, Meta’s resurgence has been a driving force behind XLC’s recent success, as Meta holds a significant 22% weighting in the index. Along with Alphabet’s stock (GOOG and GOOGL), which make up a combined 24% of the index, META’s performance has had a notable influence on XLC’s overall gains.

Looking ahead, investing in future breakouts in XLC could be a straightforward strategy for those interested in the Communication Services sector. It’s important to note the influence Meta has on XLC’s performance and to consider individual circumstances when making financial decisions.

Overall, XLC’s continued success relies on the persistence of bullish chart formations and the performance of key components within the ETF. With potential upside targets in play and strong earnings reports from companies like Disney, Netflix, Meta, and News Corp, the Communication Services sector remains an appealing area for investors to watch.

Source link

Leave a Comment