Chart of the Day: New Bullpen Name Reflects Sentiment

Typically during a market storm you might find safety in higher yielding instruments like utilities. The Utilities Select Sector SPDR Fund XLU is one that has been viewed to carry some safety for investors, a nice yielding ETF with a nice cross-section of utilities around the country. The idea here is to find the most boring group that pays nicely while the rest of the world is dealing with market chaos — and there's nothing more boring than utilities.

But while yields are often attractive on utilities there is a competitor for those capital dollars, and that is fixed income. Recently, we have seen yields on bonds rise as sellers shed their bonds (for whatever reason). That has forced sellers to hit utilities as well, their yields are ballooning with the rest of fixed income.  

Does this seem an attractive time for utilities? Probably not yet until the dust settles, which we hope is soon. For now, money flow is weak and the downtrend channel is being threatened to drop lower. If that happens, a new range will be established for XLU and it will be lower than current prices. 

We'll keep an eye on this name from TheStreet Pro Portfolio Bullpen.

At the time of publication, TheStreet Pro Portfolio had no positions in any securities mentioned.