Chart of the Day - Wednesday, September 6, 2023

Today’s Chart of the Day was shared by Jay Kaeppel (@jaykaeppel). The Technology sector ETF ($XLK) is flirting with its former highs (around $175) as it attempts to reemerge from a multi-year base. Jay points out that it's entering a period of seasonal weakness as it tests this crucial level. Michael Santoli once said, "Seasonality is climate, not weather." In other words, seasonality is never guaranteed to work, but valuable information can be gleaned even when it fails. If $XLK moves higher despite this seasonal headwind, it will tell us the underlying bid for Tech is unusually strong.