Reits and Utilities

This morning before the open I posted some charts which showed that money has been moving into the reits and utilities over the past 4 weeks. Today we saw more of that money continue to move into these two groups. The reits have been going up almost every day since the beginning of the year. There hasn't been much talk about the reits at all until today. I heard CNBC talking about how strong they are which makes me feel we'll get a pullback now that CNBC is finally commenting on them.

Reits: Breakout To New Highs

One of the strongest groups today were the Reits. Back on December 26th, I posted my reasons why the reits should rally. Basically the Reits were at a cyclical low which has been very accurate and were also at the 50 day moving average.

At the time I made that post I was bearish/cautious on the overall market so I wasn't looking to buy anything. If any of you did happen to get long some reits, I still think there is some more upside left in the trade because this particular cyclical low is usually good for about 3 to 5 weeks of upward movement.

REITS (50 day Moving Average)

I'm really not looking to buy anything right now given my bearish stance but maybe you are so I am posting this chart. The reits are sitting on their 50 day moving average which also coincides with the trendline (green dashed line). You'll notice that recently the reits tend to make bottoms approximately every 6 1/2 weeks which is where we are now. The stochastics oscillator is also in the buy zone. This looks like a low risk play to buy right here at support with a stop right below the trendline..