Action today was relatively strong with a gap up and breakthrough of major resistance points at ~$40 and the 20EMA; however, breakthrough had poor conviction and didn't hold, immediately trending back down below $40. On a lower time frame (5 minutes), multiple retests of the $40 range were rejected, leading to a large topping tail on the daily chart.
# Bearish...
ALCOA STOCK AT its lowest in 5 months Currently, the price is edging higher and the technical indicators are suggesting a possible upside pullback
Should the market extend gains in the very short-term, resistance could be met at the 39.50 barrier, break above would open way for 41,60
With broad market volatility ramping up over the past week here (see VIX, VXN, RVX), premium sellers can afford to be picky here, since the board is alight from here to Sunday with implied volatility ranks in the 70's for ... well ... a ton of stuff.
For earnings, my eye is on AA and NFLX with nearly ideal rank/implied metrics for volatility contraction...
AA broke below 1.5yr uptrend line. Came back and retested. Now is at Intermediate term down trend line. Looking for test of $44.10. If can not hold it. Buying PUTS.
AA at all times old resistance, new support. Wait to see if goes down and up, take retest. Or just bounce forming bottom (double)
On watch... interesting with tariffs.
NYSE:AA currently in buy zone testing the bottom of new trading range (stepping stone) and demand trend line. Left the previous 9-year accumulation range on light volume, which provides confidence in underlying trend. The only concern is that materials sector and aluminium industry do not show any signs of market leadership. Good for range-bound trade or...
Symbol: AA Current: $ 44.47
Lower Wing:
Buy
Option: 22nd Jun $44.00 Call
Price per option: $ 0.93
Contracts: #1 x 100
Total cost: $93
Middle:
Write
Option: 22nd Jun $44.50 Call
Price per option: $ 0.65
Contracts: 2 x 100
Total cost: $130
Upper Wing
Buy
Option: 22nd Jun $49.00 Call
Price per option: $ 0.15
Contracts: #1 x 100
Total cost: $15
Entry...
Alcoa AA is currently well oversold and is over extended below the short term and long term MAs. A bounce from these levels to return to the mean provide a 3-11% opportunity based on prior price structure.
