Playing AES

Published on Monday, 27 June 2011 07:52 Written by Christopher Lynn

New York, June 27th (TradersHuddle.com) - Shares of AES Corporation (NYSE:AES) closed the trading session at $12.12 near its 50 day and 200 day moving averages currently set at $12.66 and $12.28 respectively. AES's price action is below these important levels, which makes the stock difficult to buy, as there will certainly be resistance as it approaches these important moving averages.

AES Corporation (NYSE:AES), together with its subsidiaries, engages in the generation and distribution of electricity in Asia, North America, Europe, Latin America, and Africa. The Company sells electricity under long term contracts and serves customers under its regulated utility businesses.The company generates electricity through various resources, including coal, gas, and fuel oil, as well as hydro, wind, and solar.

Latest price action range, defined by a peaks and troughs algorithm placed calculated support at $12.23 and calculated resistance at $13.00. These levels should be watched by traders, as they provide insight into the latest price dynamics in AES shares.

Traders should evaluate their options if they want to establish a position on AES given the heavy resistance expected near the 50 and 200 day moving averages. A trade might be evident as the stock manages to break these moving averages, however until the break materializes buying the stock is nothing different than flipping a coin. Other levels that traders will closely evaluate are the ones defined by the peak and troughs algorithm that provides great price level reference points.