Approaching Resistance: Alcoa
Published on Wednesday, 02 January 2013 06:08 Written by TradersHuddle Wire
New York, January 2nd (TradersHuddle.com) - Shares of Alcoa, Inc. (NYSE:AA) are trading very close to calculated resistance at $8.91. The stock ended the trading session at just $8.68, which is near levels that make it difficult to buy or start a position.
Alcoa Inc. (NYSE:AA) produces primary aluminum, fabricated aluminum, and alumina, and participates in mining, refining, smelting, fabricating, and recycling. Its products are used in aircraft, automobiles, commercial transportation, building and construction, oil and gas, defense, and other industrial applications. Alcoa was founded in 1888 and serves customers worldwide.
Alcoa's stock range is defined by its calculated support defined at $7.98 and by the resistance level at $8.91; the stock is clearly over-extended from support, making it harder for participants to establish fresh longs.
Traders don't have a clear entry point for Alcoa. However, as the stock pulls back towards $7.98 it will definitely provide a reference point to establish a trade. On the other hand, if the stock breaks above its resistance level at $8.91 then traders will get an opportunity to enter the stock as it moves to a higher range.