AIG Between the 50 and 200Day

Published on Friday, 20 August 2010 05:48 Written by Christian Paolinetti

New York, August 20th (TradersHuddle.com) - Shares of American International Group, Inc. (NYSE:AIG) closed the trading session at $35.55 near its 50 day and 200 day moving averages currently set at $37.15 and $33.85 respectively. AIG's price action is above the 200 day moving average but below its 50 day moving average, signaling a possible break out.

American International Group, Inc. (NYSE:AIG) through its subsidiaries provides a varied range of insurance and insurance-related products in the United States and abroad. The Company's main activities include both general insurance and life insurance & retirement services operations as well as financial services and asset management. AIG participates in the credit default swaps and mortgage backed securities markets.

AIG price action seems to be setting up for a tight range between the 200 day moving average as support and the 50 day moving average serving as resistance.

A tiered approach to enter the stock, appears to be the best way to maximize possible movements from the stock, as traders could enter AIG with a small position and wait for the stock to break out above the 50 day moving average at $37.15, where traders could add to their position as momentum builds with the breakout. The flip side will be if support being referenced at the 200 day moving average set at $33.85 breaks it could mean further downside in the horizon for AIG.