A quick look at the hourly chart and LM metrics indicate XLB is leading the 5 day trend, closely followed by GDX which has benefited from multiple BUY rating updates. The real action this morning is on XLU however, the old maid in most portfolios that’s blowing the doors off in early going along with standout VOLUME BUZZ. Short covering may be holding it up after the early surge as the rest of the market began a slow decline 1 hour in.
As a clarification to last week’s delta neutral posts: delta neutral is not the same as market neutral. Delta neutral is long and short equal positions of the same stock/ETF. Market neutral is long and short positions in different correlated stocks/ETFs (such as HD and LOW) with the goal of benefiting from momentum moves in the strongest (or weakest) and the strategy is often implemented as a pair trade.