Here is a brief review of period-over-period change in short interest in the March 16-29 period in nine S&P 500 sectors.
XLBÂ (SPDR materials ETF)
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After remaining under the 200-day moving average since March 22, XLB (57.99) retook the average Tuesday but merely by a penny. The journey toward at least the 50-day (59.27) becomes easier if 58-58.50 gives way – which is likely. This was preceded by defense of support at 55-56. In the right circumstances, the weekly chart has plenty of room to head higher.
XLE Â (SPDR energy ETF)
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After a sharp decline between late January and early February, XLE (69.91) essentially went sideways around the 200-day – between 66.60 and 68.70 – until Tuesday when it rallied past both the 50- and 200-day.  Nearest resistance lies at 70.45.
Shorts continue to cut back.
XLF Â (SPDR financial ETF)
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Subsequent to getting rejected at the 50-day 13 sessions ago, XLF (27.73) came under pressure, but, kudos to the bulls, the 200-day was defended. Ditto with support at just under 27, a loss of which could potentially begin a new round of selling.
Weekly momentum indicators are oversold. That said, there is work ahead for the bulls. The last four sessions have produced candles with topping tails.
XLI Â (SPDR industrial ETF)
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XLI (73.66) shorts have gotten aggressive in recent weeks. Even if a squeeze occurs, the ETF remains in a downtrend until it breaks out of 77, which represents a falling trend line from late January.
Tuesday, it rallied 1.5 percent, but it came in a long-legged doji session. Several times over the past couple of weeks, rally attempts got rejected at 75-76. That is the level to watch for now.
XLK Â (SPDR technology ETF)
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As are several other sector ETF’s as well as equity indices, XLK (66.14) lies in the middle of the 50- and 200-day. A test of the former (66.89) is probably just a matter of time. In the ideal circumstances, the bulls would like to go test 69, where a false breakout occurred a month ago.
