New York, August 31st (TradersHuddle.com) – Shares of Utilities Select Sector SPDR Fund (NYSE:XLU) closed the trading session at $33.89 near its 50 day and 200 day moving averages currently set at $33.02 and $32.33 respectively. Utilities Select Sector SPDR’s price action is above these important levels, which could translate into a trading opportunity.
Utilities Select Sector SPDR Fund (NYSE:XLU) seeks to provide investment results that correspond to the price and yield performance of the Utilities Select Sector of the S&P 500 Index. The Index includes companies from industries, such as electric utilities, multi-utilities, independent power producers and energy traders, and gas utilities. The Fund utilizes a passive or indexing investment approach to attempt to approximate the investment performance of the Index.
Although the price action is above important moving averages, it’s important to highlight that the 50 day moving average is currently above the 200 day moving average, signaling that the stock is not technically broken from the long side and buying the dip strategy might be the best setup out there.
Looking at peaks and troughs horizontal support and resistance levels, we can see current calculated support at $29.45 and calculated resistance at $33.71. These levels should also be evaluated by traders when planning their trades, as they provide an insight into the latest price action.
If traders want to establish a position on Utilities Select Sector SPDR need to place special attention to the stock price action and establish a position as close to the moving averages as possible. Also traders need to consider the latest price action, via the stocks current range defined by the peaks and troughs algorithm, not forgetting that if the stock had a wild move outside its range, it would certianly take a few days to establish support and resistance.