Formatting text with sed on OS X/tcsh

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In order to make my sed changes more evident, I would like to be able to underline words that have been changed by the substitute command. For example

$ cat file | sed 's/OLD/NEW/g' | more

but I want NEW to be underlined in the output. I am using iTerm2. I suspect the solution involves the use of ASCII escape characters, but so far nothing has worked.
 
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