The PHLX SIG Steel Producer Index (^STQ) is up +32% for the quarter... trading to all-time highs.
The PHLX Oil Service Sector Index (^OSX) gained +9.5%. Look for bigger returns as the summer travel season approaches.
The PHLX SIG Coal Producers Index (^SCP) advanced +11% for the quarter.
Also, the PHLX Utility Sector Index (^UTY) accrued +8% over the last three months.
And, the PHLX SIG Oil Exploration and Production Index (^EPX) banked +6.35% for the quarter.
Which sectors are lagging? Take a look in Market Metrics...
Over the last quarter, AEP was up over 14.5%... with analysts expecting revenues of $3.19 billion.
Let's see what is driving the technical picture...
The weekly chart shows AEP easing into the end of a third Elliott wave up.
The Stochastic RSI may predict the end of the short-term trend as it moves into the extreme part of its range.
As the volume tapers-off, the Elliott Oscillator continues to rise, confirming the strength of the over-all trend.
How can we trade this stock? Let's look at the daily chart...
The expanding bands of the MA Oscillator confirm the strength of the trend... predicting it won't end anytime, soon.
Additionally, the CCI reveals levels of price support, as well as, confirming the strength of the up-trend.
Finally, the moving average channel has been a good indicator of price support... containing price action at key areas of congestion.
Look for AEP to trade above $50... trading to a final price target near $70.
You have to ask yourself, are the PHLX component stocks an accurate reflection of sector activity?
Or... are they merely hand-picked to enhance the performance of the index?
These are some questions to consider the next time you are selecting a stock from the "strongest" sector.
Until next time...
Russ Schmidt, President
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