The Wall of Worry Could Send This Sector Higher

Investors are avoiding one U.S. sector today. But that Wall of Worry could help send prices higher from here... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [DailyWealth] This essay was originally published in DailyWealth Trader, a daily trading advisory, and has been adapted. To learn more about this service, [click here](. --------------------------------------------------------------- The Wall of Worry Could Send This Sector Higher By Chris Igou, analyst, DailyWealth Trader --------------------------------------------------------------- The Wall of Worry is healthy for a bull market... It means not every investor has shown up to the party yet. And it means that prices will likely go higher after a pullback happens. We're seeing this play out in one U.S. sector right now. It's in a strong uptrend. Yet folks don't want anything to do with it. They're worried that some new boogeyman is going to knock it off its course. And that usually means higher prices are on the way... --------------------------------------------------------------- Recommended Links: [Tonight at Midnight, Marc Chaikin Is Closing the Doors]( Until then, claim one free year of his Power Gauge system... and FREE access to his new Market Insights (a $999 value). See where cash is going – BEFORE it gets there – for the chance to double your money, over and over again. By midnight Eastern time, [click here for the full details from a Wall Street veteran](. --------------------------------------------------------------- [Porter: 'A New Form of Money Is Making Some Rich – Should You Get It?']( Porter Stansberry is one of America's most controversial CEOs, and he says a new form of money is making some Americans (including Elon Musk and Jeff Bezos) rich. This has nothing to do with gold, bitcoin, or anything like that, but it's 100% legal. The problem? Porter says few Americans have a real understanding of how it works. [Learn more here](. --------------------------------------------------------------- If the Wall of Worry is a new idea to you, it's simple. It comes from an old Wall Street saying... "Stocks climb a Wall of Worry." In short, fear in the thick of a bull run is healthy. Folks will try to find reasons for why the current rally won't last. Every bump in the road feels like the next crash to them. So we get short-term dips in the market when investor fear jumps. But the crash folks are waiting on doesn't show... and the bull run continues. This is happening right now in consumer-staples stocks. First, let's look at just how fearful investors are of this space. We can see it through the Consumer Staples Select Sector SPDR Fund (XLP). Thanks to the fund's structure, it can create or liquidate shares on investor demand. The share count goes up when demand for XLP rises. And it falls when people get fearful or lose interest. That makes it a great gauge of investor sentiment. Right now, XLP's shares outstanding are near the lowest level we've seen since 2022. Check it out... Investors have been bailing on XLP since late May 2023. Shares outstanding are down 23% over that period. This is where things get interesting... The fund bottomed in October. But shares outstanding are still down 18%. At the same time, XLP is up 17% from its late 2023 low. And it's in a strong uptrend. The 200-day moving average (200-DMA) for XLP proves it. This moving average is how we gauge long-term trends in a stock or sector. The moving average is the trend. So if the 200-DMA is rising, we know the trend is up. We also love to see when a sector is trading above its rising trend line. That's an indication that we're in a strong bull run. XLP checks both of those boxes today... XLP's trend line started inching higher in March. And it's still rising today, despite XLP facing its first pullback of 2024. The stock fell 4% in the first half of April. And it has yet to regain all of that drop. Now, we could still see the fund sink further before the next leg higher. But with sentiment so bearish on consumer staples, and a strong trend based on the 200-DMA, it likely won't last long. In short, the Wall of Worry is good for this boom. And it means higher prices are likely – both throughout the market and in this sector. Good investing, Chris Igou Further Reading U.S. stocks recently fell too far, too fast. And many investors have become bearish as a result. But according to history, we're likely past the worst of the pain. So don't let the Wall of Worry keep you on the sidelines as the market rebounds... [Learn more here](. The demand for electricity is growing at an incredible rate as technologies advance. And that's good news for one "boring" yet vital sector. In fact, a powerful investing tool just turned bullish on this space... [Read more here](. --------------------------------------------------------------- [Tell us what you think of this content]( [We value our subscribers' feedback. To help us improve your experience, we’d like to ask you a couple brief questions.]( [Click here to rate this e-mail]( You have received this e-mail as part of your subscription to DailyWealth. If you no longer want to receive e-mails from DailyWealth [click here](. Published by Stansberry Research. You’re receiving this e-mail at {EMAIL}. Stansberry Research welcomes comments or suggestions at feedback@stansberryresearch.com. This address is for feedback only. For questions about your account or to speak with customer service, call 888-261-2693 (U.S.) or 443-839-0986 (international) Monday-Friday, 9 a.m.-5 p.m. Eastern time. Or e-mail info@stansberryresearch.com. Please note: The law prohibits us from giving personalized financial advice. © 2024 Stansberry Research. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from Stansberry Research, 1125 N Charles St, Baltimore, MD 21201 or [stansberryresearch.com](. Any brokers mentioned constitute a partial list of available brokers and is for your information only. Stansberry Research does not recommend or endorse any brokers, dealers, or investment advisors. Stansberry Research forbids its writers from having a financial interest in any security they recommend to our subscribers. All employees of Stansberry Research (and affiliated companies) must wait 24 hours after an investment recommendation is published online – or 72 hours after a direct mail publication is sent – before acting on that recommendation. This work is based on SEC filings, current events, interviews, corporate press releases, and what we've learned as financial journalists. It may contain errors, and you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility.