XLE (State Street Energy Select Sector SPDR ETF) has been trending higher since the July 1, 2026 low, unfolding a bullish impulse on the 1‑hour chart. The sequence of higher highs and higher lows continues to support the upside outlook. Our strategy guided members to avoid selling and instead focus on buying dips in 3, 7, or 11 swing sequences at defined blue box areas.
Technical View — September 14, 2026 (1‑Hour Chart)
- Rally from the August 26 low unfolded as an impulse.
- Wave 1 completed at $66.41.
- Wave 2 corrected as a zigzag:
- ((a)) ended at $64.34.
- ((b)) bounced to $66.33.
- ((c)) reached the blue box zone $64.25–$62.97.
- This zone offered a low‑risk long entry, where buyers were expected to step in for at least a 3‑wave bounce or the next impulsive leg higher.
Updated View — September 15, 2026
- XLE reacted strongly higher after completing the correction in the blue box.
- Members quickly converted positions to risk‑free once protective stops were in place.
- A break above $66.41 is required to confirm the next leg higher toward $69.28–$72.44, before profit‑taking and another corrective pullback in 3 or 7 swings.
Trade Plan and Risk Management
- Entry: Buy dips into the blue box using 3, 7, or 11 swing sequences.
- Stops: Place stop‑losses below the blue box to define invalidation and secure risk‑free status once price confirms.
- Targets: Scale out into the $69.28–$72.44 extension zone.
- Timeframe: Favor short to medium tactical holds; avoid passive long exposure without active risk controls.
- Position sizing: Adjust size conservatively relative to unleveraged ETFs to account for volatility.
Why This Setup Works
The blue‑box framework blends Elliott Wave structure with measured risk zones, enabling traders to:
- Enter with defined risk and clear invalidation levels.
- Convert positions to risk‑free quickly after confirmation.
- Capture high‑probability moves while limiting downside exposure.
Discipline in risk and money management, combined with Elliott Wave and cycle analysis, is essential to execute this plan consistently.
Source: https://elliottwave-forecast.com/bluebox-wins/energy-sector-surge-xle-rally-from-blue-box-zone/