Key Momentum Shifts

  • Energy Enters Leading: Energy (XEJ) has moved into the Leading quadrant following a strong 2.19% daily gain.
  • Financials and Consumer Staples Remain in Leading: Financials (XFJ) and Consumer Staples (XSJ) continue to occupy the Leading quadrant.
  • Four Sectors Remain Improving: Consumer Discretionary (XDJ), Property (XPJ), Industrials (XNJ) and Communication Services (XTJ) remain in Improving.
  • Resource Momentum Shows Divergence: Resources (XJR) and Health Care (XHJ) remain in Weakening, while Energy has moved into Leading.
  • Materials Remains Lagging: Materials (XMJ) remains in Lagging despite gaining 1.28% during the session.
  • Technology Remains Lagging: Information Technology (XIJ) continues to occupy the Lagging quadrant despite a 0.30% daily increase.
  • Health Care Shows Limited Momentum Improvement: Health Care (XHJ) gained 0.08% but remains in Weakening.

The latest Relative Rotation Graph for 16 September 2026 shows continued divergence across ASX sectors. Financials, Consumer Staples and Energy occupy the Leading quadrant, while Consumer Discretionary, Property, Industrials and Communication Services remain in Improving. Resources, Utilities and Health Care are positioned in Weakening, while Materials and Information Technology remain in Lagging. The chart highlights a notable improvement in Energy's relative momentum following its strong daily performance. The RRG structure is consistent with the distinction between short-term price performance and broader relative momentum shown in the reference analysis.

Momentum Breakdown by Quadrant

ASX Sector Relative Momentum Chart (at the closing price of 16/09/2026). Powered by: amibroker.com.

Leading Quadrant

Financials (XFJ), Consumer Staples (XSJ) and Energy (XEJ) are positioned in the Leading quadrant. The chart shows these sectors above the horizontal midpoint and to the right of the vertical axis, indicating relatively stronger momentum and relative strength.

Energy is the most notable development in this group. XEJ gained 2.19% on 16 September, making it the strongest-performing sector of the day. Its movement into Leading represents a significant improvement in its relative momentum compared with the previous RRG configuration, when Energy remained in Weakening. The strong daily performance reinforces the change visible on the chart.

Financials remains in Leading even though it declined 0.37% during the session. This again demonstrates that the RRG reflects a broader momentum cycle rather than simply the latest daily return. Consumer Staples also remains in Leading despite falling 1.15%, highlighting the same distinction between daily performance and relative momentum.

Continued movement upward and to the right would indicate further strengthening of the Leading positions.

Improving Quadrant

Consumer Discretionary (XDJ), Property (XPJ), Industrials (XNJ) and Communication Services (XTJ) remain in the Improving quadrant.

Consumer Discretionary declined 0.35% on 16 September but remains in Improving. Its position suggests that relative momentum continues to recover despite the negative daily return. Property also remained in Improving after falling 0.54%, while Industrials gained 0.36% and Communication Services advanced 0.46%.

Communication Services is positioned relatively close to the centre of the RRG. Further movement toward the upper-right area would strengthen its improving signal. Similarly, continued upward and rightward movement from Consumer Discretionary, Property and Industrials would increase the likelihood of these sectors transitioning into Leading.

The positioning of these four sectors indicates that relative momentum is improving across several areas outside the current Leadership group.

Weakening Quadrant

Resources (XJR), Utilities (XUJ) and Health Care (XHJ) remain in Weakening.

Resources gained 1.55% on 16 September, representing a substantial rebound after its recent weakness. However, the sector remains in Weakening on the RRG, demonstrating that the strong daily performance has not yet translated into a full improvement in its broader relative momentum.

Health Care was almost unchanged, gaining only 0.08%, and remains in Weakening. This contrasts with its previous strong daily performance and indicates that its broader relative momentum has yet to recover significantly.

Utilities gained 0.28% and remains below the horizontal midpoint. Its position suggests that the sector continues to experience relatively subdued momentum compared with sectors in Leading and Improving.

Lagging Quadrant

Materials (XMJ) and Information Technology (XIJ) remain in Lagging.

Materials gained 1.28% during the session, but its position in the lower-left portion of the RRG indicates that relative strength and momentum remain weak. The positive daily return therefore has not yet been sufficient to shift the sector into Improving.

Information Technology also gained 0.30%, yet remains in Lagging. This illustrates once again that a modest one-day advance does not necessarily result in an immediate change in the broader momentum classification.

A sustained movement toward the centre of the chart would provide the first indication of improving relative momentum for both sectors. A subsequent transition into Improving would provide stronger confirmation of a recovery.

Bottom Line

The 16 September 2026 ASX Relative Rotation Graph shows an important change in sector momentum, with Energy moving into Leading following its 2.19% daily gain. Financials and Consumer Staples also remain in Leading, although both recorded modest declines during the session.

Consumer Discretionary, Property, Industrials and Communication Services continue to occupy Improving, indicating that their relative momentum remains in a recovery phase. Resources also recorded a strong 1.55% gain, but its position in Weakening shows that the recent price recovery has not yet translated into stronger relative momentum.

Materials and Information Technology remain in Lagging despite positive daily performances, while Health Care and Utilities continue to occupy Weakening.

Overall, the latest RRG highlights a continued rotation in ASX sector momentum. Energy has emerged as the most notable improving sector, while Consumer Discretionary, Property, Industrials and Communication Services remain positioned for further momentum development. Continued movement toward Leading would provide stronger confirmation of improvement, while sustained recovery in Resources, Materials, Health Care and Technology would be needed for a broader strengthening of ASX sector momentum.