UTIL Utilities Weekly Chart Teasing the 50 MA Trap-Door

The critical UTIL 50-week MA at 648.41 is in play; also known as the 'trap-door'. If UTIL fails at 648-645, the stock market will collapse lower the SPX would be expected to dump 20 to 40 handles very quickly. Market bulls are okay if they keep price above the 50-week.

Utilities are in a weekly downtrend for about five weeks. This continues to forecast a sick stock market ahead. Look back to 15 weeks ago and always compare that weekly closing price to the current price to determine if a weekly uptrend or downtrend exists. Uptrends forecast continued higher prices in stocks while downtrends forecast trouble ahead.

The chart has an H&S in play. If the 640 is lost, 560 is on the table. The television pundits told Ma and Pa Kettle to buy safe dividend stocks. Aunt Nancy took her entire life savings and went long utilities at UTIL 720 like the guy on television advised but now she is eating cat food each evening huddled in front of a potbelly stove for warmth. The guy on TV sold his shares to her. Every top needs a bag holder.

Watch the trap-door at UTIL 648.41 since an epic move lower will occur quickly after it fails. The bulls are okay as long as they keep UTIL above the 50-wk MA and moving higher to try and flip utes back into a weekly uptrend. The MACD line is weak and bleak so lower lows would be expected for price after any bounce would occur in this weekly time frame. 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.

Note Added 9:50 AM: UTIL drops to 650 after the opening bell but bounces to 655. The trap-door will not yet open but it will open some day ahead.