On Saturday the UK conducted airstrikes against the Houthis in Yemen. This is an effort to stop attacks against cargo ships in the red sea which has seen the cost of shipping skyrocket since a few months.
Ultimately, action in the red sea has affected oil prices which have notably increased as well. Worthy to note that in the past week, some energy stocks have reported earnings which were on target. Our timing signals have reported two weeks ago a buy sector for the energy sector on the short term.
Currently XLE – Energy Select Sector SPDR Fund – is sitting on a support level of around 83.50$. This level is important to watch. If buying volume volume comes in, we can see this ETF easily rise to 88.00$. For now the technology sector is stealing the show. However, should that sector cool down, we expect money to get redistributed into such sectors as energy.
