Defensive Posture:
As the tech-heavy Nasdaq once again has issues at the very round 20000 number and upside gap fill from the 1/24 session is it time to park some capital in a conservative stance? Consumer staples get very little attention but may be deserving of your funds. Notice seasonality wise February tends to be a flat month but perhaps investors will be looking forward to March which over the last 4 years (recency bias) has easily been its best advancing every March since 2021 by an average of 4.5%. Of course, good stock pickers can provide alpha there and outperform. The WEEKLY chart below of the XLP shows a possible gap fill and then a double bottom base can set up. In January the MONTHLY chart successfully retested a bull flag breakout. Looking at a couple of names inside the space that look somewhat attractive include HSY and EL. EL is now at an inflection point and a move above 85, both resistance and support the last 6 months, next week could see this push swiftly toward the very round par number. And what happened with all the HSY euphoria surrounding MDLZ? Market participants as usual were reckless and now that the jubilation has subsided could it be worth another look near 145, where it previously broke above a MONTHLY bull flag.