Current trend

Shares of Alcoa Corp., one of the largest aluminum producers, resumed their decline at the beginning of the year and formed a medium-term downward channel: last week, the price reached its lower limit of 25.00 (Murrey level [0/8]), began a correction and approached the reversal mark of 28.12 (Murrey level [2/8]), which breakout will allow it to reach the area of 29.69 (Murrey level [3/8], the upper limit of the downwards channel) and 31.25 (Murrey level [4/8]). With a reverse breakdown of 26.56, the decline will resume in the zone of 25.00 (Murrey level [0/8]), 23.44 (Murrey level [–1/8]), and 21.88 (Murrey level [–2/8]).

Technical indicators suggest a resumption of decline: Bollinger bands are directed downwards, the MACD histogram is stable in the negative zone, and Stochastic is directed upwards, but has reached the overbought zone, which indicates the possibility of a reversal.

Support and resistance

Resistance levels: 28.12, 29.69, 31.25.

Support levels: 26.56, 25.00, 23.44, 21.88.

Trading tips

Short positions may be opened below 26.56, with the targets at 25.00, 23.44, 21.88 and stop loss 27.70. Implementation time: 5–7 days.

Long positions may be opened above 28.12, with the targets at 29.69, 31.25 and stop loss 27.00.