Utilities as a safe play … not yet!

there has been speculation that Utilities are a safe play in a deflationary environment.  I don’t know what the fundamentals say, but I do believe we are starting another wave down in the Utilities.  After a very clear 5 waves down into the low of 2009, they have behaved much like everything and bounced rather nicely.  One caveat … they didn’t make a new high as the rest of the indices were soaring.  So, where do I “think” they are now …? If we neck down into a daily chart I am going to say the “bounce” from 2009 ended in April 2013 in/around 540.  That’s either a BIG 2 or BIG B.  Since then we carved a very “Ray Charles” count in 5 waves and just completed (today) the last leg of a triangle labeled a-b-c-d-e.  If we take out the triple top at 512 then perhaps a little higher, a little change count and we can make it a-b-c.  What am I trying to say … we have completed a CORRECTIVE PATTERN either HERE or a little higher and the utilities should start down in a potentially violent and large way.

the other thing I see is a FOLDBACK pattern that has folded back up the 2000-2002 meltdown.  That puts us cresting at the top for another fall …patterns SUGGEST we foldback down to the left in a bear market for utilities.

long term look at a potential foldback in the DJUA

long term look at a potential foldback in the DJUA

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One Comment on “Utilities as a safe play … not yet!

  1. Pingback: Utilities (DJUI) update | Bart's Charts

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