The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage. The opinions expressed are those of the author and do not represent the views of TheStreet or its management.

NEW YORK (

TheStreet ) -- We had some interesting questions on The FRED Report (

www.theFREDreport.com

) weekly

technical market call

about sectors. One of our concerns of late has been Middle East tensions which have affected the oil markets, but as these abate seasonal trends could reassert themselves.

This is important because normally, energy and energy stocks have a tendency to fall off in the spring, and then rally in the summer

. We have seen oil (the USO) pull back, but not the XLE and OIH.

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We have been advocating a tilt in allocation away from Energy (the XLE) and into Consumer Staples (the XLP).

This shift would accomplish a few things. First, it would make portfolios a bit more defensive -- and while we are bullish for 2011, it is likely that this strong up-move will have some sort of a correction. Second, it moves out of Energy in advance of a possible seasonal correction. In addition, while the XLE has been seasonally strong, it has actually lagged the XLP intermediate-term. We show charts below, and note that a strong close on XLP is an all-time high close. So, we can see that even though XLP has defensive characteristics, it has been keeping up with the S&P on the upside.

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There are several stocks we have written about in our Sector Review that are strong-looking names. We show charts of these below. Notice that these are mostly household name stocks, which we have liked in prior articles here at

TheStreet.

These are KFT, CL, and WAG.

In conclusion, while the market continues strong, and we remain bullish,

seasonal patterns in energy suggest oil and oil stock names could have trouble over the next few months. We would add new money to Staples

and our other over-weights found in The Fred Report -- and would tend to de-emphasize energy names at this time.

Fred Meissner is founder and publisher of

The Fred Report

. Fred is a CMT and past President of the Market Technicians Association (MTA). He recently left Merrill Lynch's Market Analysis Department and Sector Strategy Department to form The Fred Report. A detailed bio is here:

Fred Meissner

.