This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

This Chart Shows Why 2014 Could Be the Year of Energy Stocks: StockTwits

NEW YORK (TheStreet) -- If you've seen sizable returns in 2014 you've either picked the right stocks, or more importantly, you've been investing in the right sector.

The two strongest sectors of the year, so far, have been energy and utilities. The largest utilities exchange-traded fund, the Utilities SPDR (XLU), is up 13% this year. The largest energy ETF, Energy Select Sector SPDR (XLE), is up nearly 4%. Why are these the two strongest sectors of the year? It could be for a number of reasons. Some investors have cited the importance of dividends. Others have mentioned a rotation out of momentum stocks and into value oriented stocks.

XLE hit a new all-time high today at $91.96/share and that is remarkable. Especially when you see the chart we shared below. In-fact, this is the type of signal to look for in weak or turbulent markets -- find the stocks that are holding up the best. The five largest holdings in the XLE ETF are Exxon (XOM), Chevron (CVX)Schlumberger (SLB), Occidental Petroleum (OXY) and EOG Resources (EOG).

On StockTwits, a specific chart caught our eye about the energy sector. It shows the ratio between XLE and the S&P 500. Since 2011, this ratio has been in a huge downtrend. Meaning the S&P 500 has been outperforming the energy sector for three years now. But that might have totally changed today, as that ratio broke through the huge downtrend: 

One reason to be bullish energy is the relative strength of $XLE versus $SPY on the ratio chart - Serge Berger (@steadytrader) Apr. 16 at 03:01 PM

If you enjoyed this article make sure to follow the author on Twitter and StockTwits

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
AAPL $129.94 -0.36%
FB $79.26 -1.40%
GOOG $562.86 1.30%
TSLA $203.79 -1.60%
YHOO $44.28 -0.38%


DOW 18,188.70 -25.72 -0.14%
S&P 500 2,111.04 +0.30 0.01%
NASDAQ 4,981.3840 -6.5060 -0.13%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs