Of the 28 trading days in the books so far in Q2 (3/31 – 5/11), XLK has been positive during 25 of those with an average return of 1.3% per day during positive trading days as the fund has gained more than 30%.
While Monday’s (5/11) trading appeared muted for broader U.S. equity indices with the S&P 500 Index (SPX) up 19 basis points, technology continued its charge higher with the State Street Technology Select Sector SPDR ETF (XLK) gaining 1.3% and rallying to a new chart high at $178. Of the 28 trading days in the books so far in Q2 (3/31 – 5/11), XLK has been positive during 25 of those with an average return of 1.3% per day during positive trading days (average return of 1% including the three negative trading days) as the fund has gained more than 30%.
An examination under the hood of the individual holdings within XLK reveals that 29 out of 73 (or roughly 40%) have made new or matched all-time chart highs during the month of May, with 20 of those 29 improving on recent highs during Monday’s trading. Below is the list of XLK holdings that have reached new highs, organized by date. Among those individual stocks to push to new all-time highs during Monday’s (5/11) trading are NVIDIA (NVDA), Micron (MU), Advanced Micro Devices (AMD), Intel (INTC), and Cisco (CSCO).
On the trend chart, XLK reversed into a column of Xs to kick of Q2 in the lower $130s and has since maintained that column as the fund has rallied to new highs this week, extending further into overbought territory. Monday’s (5/11) Daily Equity Report covered the broader market’s recent run into overbought territory, noting that while currently in very overbought territory, the weekly OBOS readings haven’t gotten to rarified territory, just yet. For XLK though, the weekly overbought reading for the fund has reached its highest level ever with data going back to the beginning of 1999. Friday’s (5/8) trading solidified the highest weekly OBOS reading by the week’s end (when the readings become official) at 136%, while Monday’s trading brought a further increase to the weekly OBOS reading at 146%.
The continued push to new highs in recent weeks by XLK has brought technical improvements as well, with the market RS chart against the S&P 500 Equal Weight Index (SPXEWI) reversing back into Xs in the back half of April. With a fund score of 5.78 (out of 6), XLK scores higher than the average technology fund (4.33) on the Asset Class Group Scores page, lagging only semiconductor and smaller cap tech ETFs in terms of fund score.
With the extension into overbought territory prevalent on charts like XLK’s, investors will look for when and to what extent a pullback might persist. Ideally, pulling back, consolidating near highs, developing support near current trading levels, and a normalization of the 10-week trading band and weekly overbought/oversold reading provides a constructive setup for potentially entering into positions coming off recent highs. Tuesday’s action brought about a reversal into Os from recent highs to $172, but a further pullback to the lower $160 to upper $150 range to bring the fund into a more actionable range. Prior resistance around $150 may be seen as initial support, while support at $128 has been in place since August of 2025.
