NEW YORK (TheStreet) -- Good day, traders!
1. First, let's look at Alcoa, which produces and manages primary aluminum, fabricated aluminum and alumina. TheStreet Ratings has a buy rating on this stock.
Alcoa traded up 0.4% on Wednesday, closing at $16.50.
- Wednesday's range: $16.36 - $16.69
- 52-week range: $7.68 - $17.22
- Wednesday's volume: 13,097,682
- Three-month average volume: 15,046,900
Alcoa looks good as a pullback opportunity. Shares had traded down to below the 20-day simple moving average and consolidated around the $16.20 area. Over the last couple of days, shares have inched up, and on Wednesday they closed above the 20-day simple moving average. Plus, Wednesday's price action formed a bullish engulfing signal, which is always a good candlestick signal to trade. We'll need to see confirmation Thursday, but even if Thursday sees the chart form a doji and shares consolidate above the 20-day simple moving average, this looks like a good chart to be in on the dip.
I would look to enter this trade above the 20-day SMA, anywhere above $16.45. I would prefer to buy on strength to the upside. I would set a stop at around $16.11. I would target the 52-week high at $17.22, but ultimately I think Alcoa is a great chart to let ride, as shares are up nearly 60% this year, with no signs of stopping.
Alcoa is a great chart to buy on the dips and take partial profits on at the top. Stay long until you see a sell signal or a close below the t-line.