This Industry Has Charged Into A Leadership Role

Two months ago, the commodity chemicals ($DJUSCC) group was languishing near a 3-year relative low (black arrow on chart below) vs. the S&P 500.

But things changed dramatically when the group broke its relative downtrend in early April. It ranks 7th out of 104 industry groups over the past three months and hasn't even broken out on an absolute basis yet. When and if that breakout occurs, I believe we'll see even more money rotating into this space:

In the meantime, the green arrows highlight the successful 20-day EMA tests on recent pullbacks. Currently, the 20-day EMA resides at 675. So there's your short-term trading range. 675 to the downside and 715-720 to the upside. LyondellBassell Industries (LYB), Dow Holdings (DOW), and Olin Corp (OLN) are three individual stocks in the space trending higher right now. They might be considered on 20-day EMA tests. Two other stocks in the space that are lagging a bit recently, but appear strong from a longer-term perspective are LSB Industries (LXU) and Huntsman Corp (HUN). LXU, in particular, could be on the verge of resuming its very strong March/April uptrend.

Happy Trading! Tom Bowley Chief Market Strategist EarningsBeats.com Better Timing. Better Trades.