What Utilities' Chart Indicators Suggest – Market Realist

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Weekly Recap: How US Utilities Traded Last Week PART 2 OF 5

By Vincent Kruger  | Oct 9, 2017 12:02 pm EDT

Chart indicators

The Utilities Select Sector SPDR ETF (XLU) is still trading below its 50-day moving average level, which indicates that it might continue to trade weak in the short term. Currently, it’s trading at a fair premium that’s nearly 3% above its 200-day moving average level. The level at ~$51.96 will likely act as a support in the near future.

XLU’s RSI (relative strength index) stands at 46. XLU looks stable considering its RSI levels. Technical analysts think that RSI values below 30 indicate trading in the “oversold” zone, while RSI values above 70 indicate trading in the “overbought” zone.

What Utilities’ Chart Indicators Suggest

Top utilities’ chart indicators

The largest utility by market capitalization, NextEra Energy (NEE) stock is trading at a marginal discount to its 50-day moving average and 8% above its 200-day moving average level. Its RSI is at 49.

Duke Energy (DUK) stock is trading at a 2% discount and at a 2% premium to its 50-day and 200-day moving averages. Duke Energy has its RSI near 48.

Southern Company (SO) stock is trading at a marginal premium to both its 50-day and 200-day moving average levels, which highlights the strength in the stock. Southern Company’s RSI is at 60.

Analyzing these three utility giants’ chart indicators could be vital for investors. Together, the three stocks form more than 25% in XLU. It should be noted that these three utility giants’ stocks seem fairly placed right now, which might result in XLU’s continued recovery.

Read Could Trump’s Tax Reform Hurt Utilities? to learn how President Trump’s tax reforms could impact utilities going forward.

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