American Axle Tight Range between the 50 and 200Day

Published on Wednesday, 08 September 2010 08:40 Written by TradersHuddle Staff

New York, September 8th (TradersHuddle.com) - Shares of American Axle & Manufacturing Holdings, Inc. (NYSE:AXL) closed the trading session at $8.91 near its 50 day and 200 day moving averages currently set at $8.70 and $9.12 respectively. American Axle's price action is above the 50 day moving average but below its 200 day moving average, which provide a nice trading setup, with clear reference points.

American Axle & Manufacturing Holdings, Inc. (NYSE:AXL) designs, engineers, and manufactures driveline systems for light trucks and sport-utility vehicles. The Company produces axles, propeller shafts, chassis components, and forged products.

American Axle price action seems to be setting up for a tight range between the 50 day moving average as support and the 200 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 American Axle with a small position and wait for the stock to break out above the 200 day moving average at $9.12, where traders could add to their position as momentum builds with the breakout. The flip side will be if support being referenced at the 50 day moving average set at $8.70 breaks it could mean further downside in the horizon for American Axle.