Sector sitting at an all-time high has more room to run, technician says

As stocks see their worst week of the year, this sector just hit a new high

The broader market rally that kicked off 2019 with a bang is starting to show signs of slowing.

Last week, for the first time since 2016, all three major indexes closed lower every single trading session. Markets were inching higher Monday. One top technician says now might be the time to look for a big payoff in one of the markets' safest spaces.

"I think utilities are one of the places you want to be," Cornerstone Macro head of technical analysis Carter Worth said Friday on CNBC's "Options Action."

The S&P Utilities ETF, the XLU, has drastically outperformed the broader S&P 500 during the past year — gaining nearly 17 percent compared with a flat S&P 500. Worth says that, given falling bond yields all over the world, now could be the time to move assets into a part of the market that is making fresh all-time highs.

"The S&P Utilities are making new highs, S&P 400 Utilities are making new highs, and here — to talk about how mechanical it is — this is the entire past decade. … Look how much of an uptrend it actually is. [The XLU] has literally come and touched this line over and over and over as though it's on some sort of autopilot," Worth said.

Worth also pointed out that this sector has continued to outperform despite difficulties faced by some of its major constituents. Hurricanes and wildfires wreaked havoc on some of the biggest names in the utilities space in 2018, and yet the sector is still adhering to its uptrend.

"PG&E has been smoked because of the forest fires, Edison International [has also suffered]. If you were to put those back in, so to speak, we would be making substantial new highs," said Worth. PG&E, under continued scrutiny for its role in a series of California wildfires in 2018, has lost more than 50 percent of its value during the last year.

"We are now – just now – making new highs," Worth said. "It is the only sector, both at the S&P 500 level and the 400 level, that is making all-time highs. That says a lot. … I want to be long utilities."

The S&P 500 Utilities ETF was trading slightly higher on Monday and notching a fresh all-time intraday high.