Utilities Select Sector SPDR Fund has been generous in 2016

Jun 8th, 2016 – 2 Comments

Looks like it has more to give


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Lou Schizas is an equities analyst, investor, entrepreneur, professor and television and radio personality – and a true believer in the happiness-inspiring powers of capitalism.


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This analysis of the Utilities Select Sector SPDR Fund (XLU NYSE) will complete Roger’s assignment that started back in late May. This exchange traded fund consists of 31 stocks in the following sectors; electrical utilities 59.54%, multi- utilities 33.16%, water utilities 1.95%, independent power producers 1.89%, gas utilities 1.24%, and the rest of the capital unassigned. The dividend yield on the units is 3.21% which could satisfy investors looking for income.

An examination of the charts will help identify the trend, support, and resistance associated with this ETF.

 

 

XLU

The three-year chart exhibits a new leg up that started in late December of 2015 as the MACD and the RSI generated buy signals. The units caught a bounce off support near $41.00 and ran to a 52-week high of $50.35. What is evident as well is that XLU has met resistance near $50.00 and will have to move through it to continue the advance.

 

 

 

 

XLU2

The six-month chart pulls into focus the buy and sell signals generated by the momentum indicators. Make note of the overbought situation that existed in March and the sell signals ahead of the pullback in April. The MACD and the RSI are indicating that the move up that started in May has more in to give.

After reviewing the ETF’s that were recommended on a website that Roger was reading the best take away from this exercise is that investors need to undertake the task of conducting their own due diligence. I look at a wide variety of sources which I treat as idea generators which I then put under the microscope to see if they are suitable for my personal investor profile and within my investment horizon.

 

 

Next time I will conduct another inspection of the charts for First National Financial Corp. (FN TSX) for Gordon.

Make it a profitable day and happy capitalism!

Categories: ETF
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