Xcel Energy (XEL) had quite a run in 2024. While the stock finished the year up just 9%, it rallied nearly 60% from the March low to the November high — before aggressively fading to conclude 2024. That was part of a broader reset for many stocks during those final weeks last year, especially utilities. The wild turns didn’t stop there, with XEL then ripping higher once more, but then again failing to overtake that same level that it topped at last fall. Since February, though, XEL has been carving out what now looks like a potential bullish inverse-head-and-shoulders pattern. Notably, this formation is developing above a rising 200-day moving average — which XEL never closed below — even during the broad market selloff in recent weeks. The stock still has work to do to complete the pattern, but a breakout through the $72–$73 zone would prompt an initial target near $83. Zooming out to the weekly chart, it’s clear that the above formation — which has taken shape over the past two months — also is part of a much larger bullish set-up. Specifically, it represents the right shoulder of a potential two-year inverse-head-and-shoulders pattern. That means a breakout through the $72–$73 zone would trigger two bullish formations simultaneously across multiple timeframes. This would be highly constructive: bullish breakouts in both the short-term and long-term charts would be a powerful combination and could encourage a new round of demand and upside follow through. The question, of course, is whether XEL has any more gas in the tank after rallying from the mid-$40s to the low $70s over the past year. For some context, we need to look even further back at the last 20 years of price action. What stands out is that XEL is now attempting a comeback after a 35%-40% decline — for the third time in the last two decades. The first big drawdown pictured below happened during the 2007–2008 financial crisis, and the second, as part of the 2020 COVID crash. In both cases, XEL pivoted, bounced strongly and then ultimately went on to eclipse its prior highs. Past performance doesn’t guarantee anything, but the fact that XEL has a track record of recovering from deep declines and continuing its long-term uptrend suggests that a similar outcome wouldn’t be surprising this time. If that does play out, it would mean XEL could break out of the two bullish patterns, hit new all-time highs and continue beyond that. For any of that to become a reality soon, though, XLE would first need to push through the $72-$73 area. — Frank Cappelleri Founder: https://cappthesis.com DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
