The Dow Jones U.S. Recreational Services Index ($DJUSRQ) fell more than 11% last week as traders completely ignored the consumer discretionary space (XLY). The only industry group within consumer discretionary that performed worse was Business Training & Employment Agencies ($DJUSBE), which fell a staggering 28% on Friday after LinkedIn (LNKD) provided a very strong warning about 2016 prospects. Royal Caribbean Cruises (RCL) has lost more than one third of its market cap over the past 5-6 weeks, leading the DJUSRQ to the downside. Check out the chart:
Heavy volume has accompanied the selling, suggesting that this move lower is for real. A move back to test the rapidly-declining 20 day EMA would represent a solid short entry.
Happy trading!
Tom
