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Top Utility Stocks Trade in the ‘Overbought’ Zone

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Jun. 24 2019, Updated 1:23 p.m. ET

Moving averages

Utility stocks continued to rise last week. The Utilities Select Sector SPDR ETF (XLU) hit a new 52-week high and closed at $61.0 last week. Currently, XLU is trading 4% and 9% above its 50-day and 100-day simple moving average levels, respectively. The levels close to $58.8 and $55.9 might act as a support for XLU in the short to medium term. XLU has taken the support of its 50-day level numerous times in the last few months.

So far, utility stocks have shown a slow but steady rally in 2019. XLU hit a new 52-week high of $61.4 last week. XLU has rallied more than 20% since its 52-week low of 50.8 in June last year.

XLU’s RSI (relative strength index) was at 68 at last week’s closing, which indicates that it might be approaching an overbought zone.

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Top utility stocks

The top utility stocks, Duke Energy (DUK), Dominion Energy (D), and Southern Company (SO) are trading in the “overbought” zone with their RSI above 70. These three utility stocks form ~25% of XLU. All of these utility stocks are trading well above their respective 50-day and 200-day moving average levels, which indicates strength.

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