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Market rotation out from this defensive sector could signal the start of stock market capitulation based on the analog comparison of the global financial crisis in 2008.

Find out how to use analog comparison as a bear market leading indicator on top of price-volume analysis to better interpret the messages from the market. Most importantly, to prepare for the market bottom in order to ride the upcoming cyclical bull run.

Video Length: 00:15:52

As shown in the video, the decline in XLP share price in 2022 is suggestive of a market rotation out of the consumer staple sector, which is normally the last defensive sector to be rotated out by the smart money according to the market analogue in 2008.

Having said that, S&P 500 is already in a deeply oversold condition where an immediate relief rally is pending because of shortening of the thrust to the downside (annotated in blue arrow), which is an indication of fading of the selling momentum, as shown in the chart below.