Chart of the Day: Alcoa (AA)

A resistance level has formed in the chart of the world’s largest bauxite miner and alumina refiner by production volume, Alcoa (AA).

Alcoa reported earnings last week and beat EPS and revenue estimates. As a result the stock has been trading higher.  

Take a look at the 1-year chart of Alcoa (AA) below with added notations:

During the past two months, AA has formed a key level of resistance at $14 (red). The stock has tested that $14 level twice since the beginning of June.

A solid close above that $14 level should lead to higher prices for AA.  Therefore a long trade could be entered on a breakthrough of that level.  

Keep an eye on commodity prices as AA’s profits are closely tied to prevailing commodity prices along the aluminum supply chain.

Have a good trading day!

Good luck!

Christian Tharp, CMT

AA shares were trading at $13.28 per share on Wednesday morning, up $0.12 (+0.91%). Year-to-date, AA has declined -38.26%, versus a 2.27% rise in the benchmark S&P 500 index during the same period.

Author: Christian Tharp