Technology (XLK) defends support so far

Technology gapped lower on today's open, with XLK retesting last Friday's hammer at 281.60 on today's undercut down to 280.29. While it is encouraging to see an intra-day bounce to fill the opening downside gap, it would take a move above the rising 50-day and 40-day moving averages near 285.17 and 288.60, respectively, to reinforce a bullish trend.

Chart 1: SPDR Technology Select Sector Fund ETF (XLK): Daily candlestick chart

The important weekly chart support zone holds so far on XLK

The bearish engulfing pattern lows for the weeks ending November 7 and October 10 offer a key support zone from 281.60 (also last Friday's hammer low) to 278.39. XLK is defending this support so far.

Chart 2: SPDR Technology Select Sector Fund ETF (XLK): Weekly candlestick chart