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Exelon Corp - (EXC) - November 30, 2023

Although the sharp dropoff in US treasury yields has ignited a rally in equity markets in general, it hasn’t necessarily benefitted all individual stocks or sectors equally. Utilities, for example, which one would expect to do well in a falling interest rate environment, have been struggling lately.

Exelon (EXC) the largest utility in the US, dropped 10 spots in the SIA S&P 100 Index Report to 62nd place, dropping back into the Red Unfavored Zone. Exelon had only been in the yellow zone for a cup of coffee, and it has been out of the green zone since May. In the last month, Exelon is only up 0.8% compared with a gain of 8.4% for the Utilities sector overall and a gain of 10.9% for the S&P 100 Index.

Relative strength analysis doesn’t just help us to identify stocks that are falling outright, it also identifies stocks which are underperforming by trending sideways or climbing only slightly in a rising market. Exelon (EXC) shares broke down yesterday, snapping a short-term support line, resolving a Symmetrical Triangle to the downside as signaling the start of a new downswing. As it was, the previous market and treasury yield driven November bounce was weak, topping out at a lower high near $41.00 and failing to snap the downtrend resistance line which remains active.

Initial resistance has now dropped toward the 200-day moving average, which is closer to the $40.00 round number. Initial downside support may appear at previous lows near $38.00, $35.50, or $34.00, then the $30.00 round number.

For most of this year, Exelon (EXC) shares have been trending sideways. Back in September, the shares broke down, completing a bearish Spread Quadruple Top pattern. In October, the shares found support at a higher low and have bounced into November. This month’s rebound has been feeble, however, the shares have not completed a bullish pattern, remaining short of their spring/summer highs, and have only managed to generate a bullish Low Pole Warning signal. These moves have continued a larger Symmetrical Triangle pattern of higher lows and lower highs, a sign of longer-term consolidation.

A breakout close above $42.70 would complete a pending spread quadruple top pattern with next potential resistance at previous highs near $45.30 and $48.10. A close below $37.15 would complete a 3-box reversal with next potential downside support at previous lows near $35.75, then $33.65.

With its bearish SMAX score falling to 3, EXC is exhibiting weakness against the asset classes.

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