SO’s solid uptrend
Regulated utility giant Southern Company (SO) has been on a solid uptrend recently and is up ~18% so far this year. Broader utilities are up 10% on average in the same period. It’s unusual for utility stocks to see such movement. SO has risen in nine of the last ten trading sessions, lifting it to a new 52-week high.
Southern Company stock is currently trading in the overbought zone with an RSI (relative strength index) of 84. The stock last exhibited this kind of RSI level in July 2018.
It should be noted that many utility stocks are trading in the overbought zone right now. The Utilities Select Sector SPDR ETF (XLU), the representative fund of the top utilities, is close to an RSI level of 90. Southern Company’s peers Duke Energy (DUK) and NextEra Energy (NEE) are also overbought at the moment.
Southern Company is currently trading at $51.68, ~7% and 12% above its 50-day and 200-day moving average levels, respectively. The stock’s large premium to both these levels indicates its strength. These levels, which are ~$48.3 and $46.3, respectively, could act as supports for SO in the near future.
We highlighted Southern Company’s probable bullish trend based on the “golden cross” on December 12 in our article Analyzing Southern Company’s Current Chart Indicators. The stock has rallied ~10% since then.