Utilities sector outperforms. Merchants discuss outlook
One of many market’s worst-performing sectors this 12 months has turned the tables.
S&P 500 utilities stocks have been the highest sector over the previous month and in October, with the group now approaching a key bullish sample referred to as a golden cross, when the 50-day shifting common crosses over the 200-day shifting common.
The sample usually suggests to chart watchers that there is extra upside in retailer for the index. However for one dealer, golden crosses must be seen extra as guides than shopping for indicators.
“Traditionally, it is higher to take a look at this [as] extra of a gauge of power or weak point greater than utilizing it as a buying and selling sign per se,” Mark Newton, president and founding father of Newton Advisors, advised CNBC’s “Trading Nation” on Friday.
“It is simply vital to acknowledge that whenever you begin to see this rotation in the direction of defensives, it is usually essential to concentrate to the sort of factor. It usually does occur close to market peaks,” he mentioned.
With the upcoming presidential election simply weeks away…