Low Sentiment But Improving Internals For The Energy Sector

In the sector sentiment section of the weekly Thrasher Analytics letter, I noted that XLE XLE has seen a rise in breadth thrusts. This is a result of improving performance of individual energy stocks. However, sentiment remaining extremely low. Together, internals for the energy sector are improving but sentiment is ignoring it. This has been historically bullish for energy as shown by the green lines below which notes when sentiment has been under 0.2 and there's been at least 6 breadth thrusts. We've seen three major advances in XLE since 2012 with this setup and a brief advance that was then given back earlier this year.

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