A Real Money subscriber asks, "Any chance of providing readers with your thoughts on the (XLU) - the Utilities Select Sector SPDR Fund." Let's check out our favorite chart package.
In this daily bar chart of XLU, below, we can see some big up and down swings over the past 12 months. Through it all the XLU has maintained an uptrend with higher lows and higher highs. Prices are trading above the rising 50-day moving average line and the slower-to-react 200-day line.
The On-Balance-Volume (OBV) line shows a bullish rise from early March and tells us that buyers of XLU have been more aggressive. The trend-following Moving Average Convergence Divergence (MACD) oscillator is pointed up but it has narrowed in recent days.
In this weekly Japanese candlestick chart of XLU, below, we can see the past three years of price movement. Prices have rallied back towards the early 2020 zenith. XLU is trading above the rising 40-week moving average line. The weekly OBV line is bullish and so is the MACD oscillator.
In this daily Point and Figure chart of XLU, below, we can see a potential $81 price target.
Bottom line strategy: Traders who are long or looking to go long XLU should risk to $62.50 or just below the late June lows. $81 is our upside price target for now.
