A month ago the utilities sector (NYSE:XLU) was up almost 15%, making it one of the best performing sectors year to date. The strong rally over the past 8 months took XLU to the top of its rising trend channel and back to the highs reached back in 2007.
Broken Support
Last month XLU gave back about a third of its year to date gains after hitting dual resistance at (1) and recently broke below a short-term support line.
Did Utilities create a Double top at the old 2007 highs last month? I am of the opinion we will only know the answer to this question if XLU falls to the bottom of its 5-year rising channel. If it does fall that far and breaks support, then the chance of a double top increase a good deal.