Alcoa Inc. had a sharp decline to $23.91 from $53.25 (A-B) and then settled in a large horizontal trading range mostly between $21 and $34 (dashed lines).
The recent rise above the top of this range signalled renewed investor interest, a breakout and the start of a new up-leg (C).
Behaviour indicators including the rising 40-week moving average (40wMA), and the rising trend-line (solid line) confirm the positive status. The stock is currently in the midst of a minor correction toward its average, but only a decline below ±$31 would be negative.
Point & Figure measurements provide a target of $44. The large trading range (dashed lines) supports higher targets.
Monica Rizk is the senior Technical Analyst and Ron Meisels is the president of Phases & Cycles Inc. (www.phases-cycles.com). And he tweets at @Ronsbriefs. They may hold shares in companies profiled.
Chart source: www.decisionplus.com
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