The telecom sector has moved back to the top of its current trading range and is poised to break higher. Why the sudden interest in this sector by investors? Telecom fits into the utility sector as well as the technology sector based on the various stocks. Utilities tend to perform better under a falling dollar scenario. The last four weeks the dollar has been declining and the sector has been a benefactor.

As you can see on the chart below, IYZ is at the top of the trading range and prepared to break higher. The question is will there be enough of a catalyst to push through $20.75 and sustain the move. Time will tell and a couple of stocks withing the sector to watch are below as well. If the sector pulls back short term, look for support near the $19.65 mark to hold and then push back to the highs. This would be a good entry point if support holds on the test. Watch and see how this plays out near term. 

AT&T like the broader sector is attempting to break higher as well. As you can see on the chart below resistance is at the $26.70 mark and would give room for a move to the $28.65 level. If the pullback discussed above does take place look for support at $25.60 hold. This would be a confirmation to the broader index as well.

Research in Motion has struggled with Apple and others attacking their hold on the business markets with new PDA phones. The latest edition of new phones from RIMM have received solid reviews and could impact the stocks looking forward. The stock is facing resistance at the $57.35 mark and support on a pullback would be near $52.

Telecom is in a position to provide some leadership to the broad market on a break higher. Watch and play according to your risk tolerance and strategy. This sector is highlighted on the ETF Spotlight Video.