Bulls Gaining Control - AerCap

Published on Tuesday, 10 August 2010 00:39 Written by Christian Paolinetti

New York, August 10th (TradersHuddle.com) - Shares of AerCap Holdings NV (NYSE:AER) ended the trading session lower by $0.14 or -1.1% from its previous close. AerCap's price action in today's session formed what is considered to be a Hammer, where bears drove prices lower intraday. However, the strong finish indicates that bulls regained control forming a trend reversal.

AerCap Holdings NV (NYSE:AER) is an integrated global aviation company. The Company is engaged in aircraft and engine leasing, trading and parts sales. The Company also provides aircraft management services and performs aircraft and engine MRO services and aircraft disassemblies through its certified repair stations.

AerCap's stock has been trading in a well defined range with support at $12.41 and resistance at $13.75, this range is also being used by traders to plan their positions.

Traders wanting to establish a position in AerCap or traders that are already holding the stock can use the hammer formation to their advantage, since the pattern signal a potential bullish trend reversal.

Hammers are important candlesticks as they mark bottoms and support levels. Further buying pressure, and preferably on expanding volume, is needed before acting, as heavy volume will serve to confirm the validity of the reversal.

In the case of AerCap, traders who want to add to their positions or start a new position, need to watch for confirmation of the reversal. Below a Hammer illustration: