Update, November 2, 2026
XLE has slipped 2.95% over the past five sessions, closing at $67.59 on November 2, as profit-taking followed a run to a 52-week high of $70.02 on October 30. The pullback comes despite blockbuster earnings from ExxonMobil and Chevron, which reported combined Q3 profits of $25.3 billion, driven by record refining margins and oil above $100 per barrel (The Guardian). The stock remains 7.6% higher over the past month and 51.2% year-to-date, while the S&P 500 has fallen 1.1% over five days.
The picture holds: the daily trend still runs with the weekly uptrend, and price remains above its 50-day average at $65.01. The 5-day drop has not broken any key levels — support at $65.01 (50-day) and $61.1 (swing zone) are intact, and the 14-day RSI at 51.6 shows neutral momentum. The breakout math is unchanged: a daily close above $70.0 on above-average volume would target $80.0, with a stop at $64.63. The 50-day average has risen to $65.01 from $64.63 at the last report, narrowing the distance to price.
What would change the picture is a weekly close below $61.1, which would flip the long-term trend to down. A daily close below $65.01 would be the first crack, and a move below $58.83 (200-day) would signal deeper weakness. For now, the pullback looks orderly within an uptrend, with the stock still leading the S&P 500 by 5.4% over 50 days.
The State Street Energy Select Sector SPDR ETF (XLE) is trading at $69.97, a new 52-week high, up 1.8% on a day when the S&P 500 fell about 1.2%, as record refining profits at the big U.S. oil companies hit the tape. The weekly uptrend is intact and the balance of evidence leans positive, with medium conviction. Thin volume and a modest historical edge after new highs keep that reading from being stronger.
Why it matters
The trigger was a wave of third-quarter results. Bloomberg reported that Exxon earned an adjusted $4.23 a share, 10 cents above forecasts, with refining results at an all-time high on gasoline and diesel spikes tied to conflicts in the Persian Gulf and Russia. The Wall Street Journal said Exxon and Chevron, the two largest U.S. oil companies, both posted substantial profits after drone attacks on refineries tightened supply. They sit at the core of the basket. BP, PetroChina and Sinopec are outside a U.S. sector fund, but all three also reported strong quarters, so the strength is global rather than one company's.
How much was already priced in? A lot of it. The fund is up 13.8% over the past month, 17.3% over six months and 56.5% year to date. The Exxon beat itself was small, 10 cents. The surprise was the size of the refining margin, and shares are rewarding that by pushing to a high rather than gapping on a shock. Morningstar noted BP's $8.46 billion quarterly profit against a $7.33 billion consensus, with net debt cut to $13.9 billion from $22.3 billion. Earnings keep coming in above expectations, and the stock had already moved to meet them.
Over five days XLE is up 0.9% while SPY is essentially flat, so over the week the fund was not just riding the market. Today's gap is wider: energy up 1.8% against a 1.2% fall in the broad market. No sector benchmark is available to split the move further. The gap points to the theme itself, war-driven fuel prices and refining margins, rather than a general bid for equities. Over 50 days the fund leads SPY by 8.8 points, and over 200 days by 14.2.
The debate is about durability. The supportive case is the scale of the windfall: The New York Times estimated U.S. oil and gas companies earned more than $130 billion from April through September, nearly three times the under $47 billion of a year earlier. Balance sheets are healing too, a point Bloomberg's opinion desk made about BP's debt. The cautious side is that these profits come from disrupted supply, which can reverse. A Seeking Alpha piece, neutral in tone, notes how heavily energy funds now lean on refiners, the very segment posting peak margins. On valuation, the data carries no analyst price targets or consensus for the fund, so there is no spread to measure the price against. The case rests on earnings momentum and price action, not on a stated target.
What the evidence says
The long-term thesis is intact. Price is above its 40-week average, the 50-day average at $64.93 sits above the 200-day at $58.73, and the fund is 221% above its 52-week low of $21.80. This is a mature, extended advance, with the stock at its high and no pullback from it. That is the strongest phase of a trend, and also the one where a reversal costs the most.
For the next two to six weeks the balance of evidence leans positive, with medium conviction: 2 of 4 points. Two things carry it. The daily trend runs with the weekly uptrend, and the fund is leading the S&P 500 by 8.8 points over 50 days. Everything else is neutral at best, which is why conviction stops at medium.
The strongest case against is participation and base rates. Volume is running 70.7% below its 20-day average, though the session is only partly done. RSI is near 68, close to stretched. And history is unexciting: after new 52-week highs, 63.1% of cases were higher a month later against a typical 61.8%, with a median move of 1.36% across 320 cases. A new high adds almost nothing to the odds. It does not tip the balance because trend and relative strength still point the same way, but it is why the reading is not stronger.
Levels that matter
The structure sits above the 50-day average at $64.93. A close below it would be the first crack. The trend ends below $61.1, a swing zone, and under it the next supports are $60, the $59.61 swing zone and the 200-day average at $58.73. Those levels mark where earlier buyers stepped in and where the average cost of the past several months sits.
The breakout level is a daily close above $69.97, the 52-week high, on volume above its 20-day average. From there the first target is the round $80. The stop is $64.57, which is the 50-day average minus a quarter of the 1.43 ATR. That gives a reward-to-risk of 1.9 to 1. The math does not reach the 3 to 1 that makes a breakout worth the risk. It would take a target well above $80, or a confirmation that comes closer to the stop, to change that.
What would change the picture
A weekly close below $61.1 would change the picture, because it would break the swing zone that anchors the weekly trend. The non-price fact that would do it is a de-escalation in the Persian Gulf or Russia conflicts that brings gasoline and diesel prices, and with them refining margins, back toward normal. The earnings strength is tied to that disruption, and the fund's gains rest on it.
What to watch
- Remaining sector third-quarter reports: no specific dates are in the data, but margin commentary and any guidance on refining will show whether October 30, 2026 was a peak.
- Conflict and supply headlines from the Persian Gulf and Russia, including further refinery attacks, which feed straight into fuel prices.
- Volume on a close above $69.97: the breakout needs participation above the 20-day average, and today's is far below it.
- The 50-day average at $64.93, the first level to show whether buyers defend the advance.
- The S&P 500: energy rose on a day SPY fell 1.2%. If broad weakness deepens and energy stops diverging, the relative-strength case loses its main support.
- Fund flows and holdings changes: none are reported in the news here.