UTIL Utilities Daily Chart Upward-Sloping Channels Overbot Negative Divergence Traders Chasing Yield

The utilities closed above 500. Since November, UTIL has moved from 435 to 502, over 15%.  This chart illustrates the feverish search for yield. The dividend stock bubble is pumped by the Fed's easy money.  New asset bubbles are created in utilities, dividend stocks, REIT's and high-yield corporate's courtesy of the printing press. Money is being stuffed into these stocks until the seams are ripping.  The green channel was aggressive the blue channel is parabolic in nature.  The recent action may be money fleeing Europe and seeking perceived safety.

That is the funny thing.  Each trader thinks he, or she, is smarter than the other with all of them throwing money into dividend and safety plays, such as utilities, using a Ron Popiel, 'set it and forget it' mentality. Investors may not be happy as the weeks play out. Price is near the top BB at 502 so a move up to the 505-ish can not be ruled out, especially if the SPX hits 1565+ tomorrow.  The red lines clearly show the negative divergence in place so a spank down is on tap.  The weekly chart is topping as well but this type of momo may need another two or three weeks to roll over. The daily chart needs a smack down right now but price will likely recover after a pullback until the weekly chart gives the firm negative divergence signal.  UTIL should roll over as April plays out.

Traders are chasing yield and perceived safety now. They are taking the Fed's money and pumping these new asset bubbles thinking there is no worry, since, after all, consumer staples, divvy stocks, all that stuff is always safe, right? The green oval's show how the slightest pull back is bot aggressively.  The action in utilities and other dividend and perceived safety plays will be interesting to watch moving forward.  This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.