American Electric Power Co. traded between $24 and $34 from late 2008 to 2009 and then settled into a secondary area of accumulation between $31 and $37 in 2010 to complete a bullish compound base known as a duplex horizontal (dashed lines). Recent price action suggests the stock is ready to begin a new major up-leg (A).
Technical indicators including the rising 40-week moving average and the MACD (moving average convergence-divergence, see lower panel) confirm the bullish status. Only a decline below $36.50-$37 would be negative.
Point & Figure measurements provide targets of $44 and $49. Higher targets are visible.
Monica Rizk is the senior Technical Analyst for Phases & Cycles Inc. ( www.phases-cycles.com). Ron Meisels is a contributor to the www.NA-marketletter.com website. They may hold shares in companies profiled. Please see the site for a glossary.
Chart source: www.decisionplus.comReport Typo/Error
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