Defensive Sector ETFs Hit Targets, Reversals Next? (TLT & XLF)

As the stock market continues to hold near all-time highs into the end of August, two very important market sectors are potentially setting up for reversals. The 20-Year+ Treasury Bonds ETF (NASDAQ:TLT) and Utilities (NYSEARCA:XLU) have been market leaders in 2015 and 2016 as investors took a break from riskier equities like small caps. And the flocked to defensive sectors. These defensive sector ETFs emerged along with dividend stocks as “safety” and yield were of primary concern the last 2 years.

Could things be changing?

We should know shortly. As we head into month end, both treasuries and utilities have backed off their respective highs. But, more than that, both defensive sector ETFs have reached long-term price targets. So I think investors should be watching for reversal candles on the monthly (and weekly charts).

20+ Year Treasury Bonds ETF (NASDAQ:TLT)

Note that we discussed TLT several times here on @seeitmarket. Here are links to those articles:

• TLT Rally May Extend To 145 In Summer Trading
• TLT Price Targets Hit As Treasury Bonds Stretched

Dow Jones Utilities Average (INDEXDJX:DJU)

And utilities here:

• Dow Jones Utility Average Overdue For Major Correction

Thanks for reading and good luck out there.

Twitter:  @BartsCharts

Author does not have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.