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Will Old Man Winter freeze retail?

Retail is now riding high thanks to lower oil prices.

The ETF tracking the sector (trading under the symbol XRT) is up 10 percent in the past month, reflecting the market's view that sunny days are ahead for retailers as a combination of falling gas prices and rising employment puts more money consumer's pockets. But with heavy snow piling up in America's heartland, could the cold temperatures pour cold water on the sector?

Lower temperatures mean lower foot traffic at the malls, notes Gina Sanchez, founder of Chantico Global. But the more important forecasts for retailers may not be the weather.

"If forecasts hold up, then gas prices will continue to be under $3 per gallon into the holiday season," said Sanchez, a CNBC contributor. "The forecast for average prices through 2015 will also be sub-$3 due to overproduction by major producers."

That in, turn, will help put money in cash registers. "Cheap gas prompted a rebound in retail sales heading into the holiday shopping season," Sanchez said. "Low gas and rising stock and home values are boosting consumer confidence and disposable income along with falling unemployment, indicating that spending will continue to improve through year-end."

"All of those things are good for retail," she added. "However, if we have an extremely cold winter, it will limit traffic."

(Read: Cold weather to drive demand at retail)

Not only are lower energy prices boosting sales at retailers, they may also have a direct effect on retail stocks, according to the chart work of one CNBC contributor.

Todd Gordon, founder of TradingAnalysis.com, charted the ratio of the XRT versus the S&P 500 and compared it with crude oil prices. He noticed whenever oil moved down, the XRT moved stronger to the upside relative to other stocks.

And, as oil prices post their seventh weekly loss – their longest losing streak since 1986 – that could mean more upside ahead for the XRT.

(See: CNBC's Holiday Central)

"The catalyst for the retail outperformance is crude oil," Gordon said. "Crude oil is now, for the first time in a long period of time, putting more money in consumers' pockets which is then going into retail names."

But Gordon notes the benefits of lower crude may not spread entirely across the board for retailers.

"One caveat here is that the lower-end retail names are moving higher," he said. "You're seeing Wal-Mart, you're seeing TJ Maxx, you're seeing Costco – those guys are outperforming. You're really seeing an impact at the lower income level… But it certainly does look strong on the top side."

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