Wednesday, March 17, 2010

AA - Breakout

ry nice breakout today above both 50 EMA and SMA on decisive volume.  Two things to watch for here.  First the obvious, wait for a retest of the 50 EMA to see if it holds.  Second, this must break through the multi-year resistance at $15.    I believe that AA will trade between $14 and $15 in the next 2 weeks, and the earnings will make the decisive call.  If it's good, I see a breakaway gap above $15, and to $20 by the end of summer.  If it's bad then I see a potential head and shoulders playing out that will take AA back to $10.  Either way, keep an eye on the bottom trendline of the channel.   A close below that spells trouble for AA.


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