Interactive Brokers’ Traders’ Insight
By Gary Christie
April 6, 2017According to the American Water Works Association, approximately $1 trillion is necessary to maintain and expand water service to meet demand over the next 25 years. Infrastructure has been a hot topic of politicians recently suggesting that examining utility stocks may be worth the research. The global water industry is projected to top $1T by 2020 affecting water utilities, bottled water, agriculture and water conservation.
One of the top stocks in the utilities and industrial sectors that focuses on this demand is in fact American Water Works (AWK).
Recognia’s pattern recognition software has detected an anticipated event: A Double moving average crossover: Which tells us the price is generally in an established trend (bullish or bearish) for the time horizon represented by the moving average periods. In the double crossover method, a bullish event is generated when a faster moving average crosses above a slower moving average (21-bar MA crosses 50-bar, or 50-bar MA crosses 200-bar). A confirmation of this crossover will have strong bullish implications and will confirm the resumption of the up-trend.
In analyzing the stock further using Trading Central’s pattern recognition software, it has also detected a confirmed Continuation Diamond (Bullish) pattern: The price has broken upward out of a consolidation period, suggesting a continuation of the prior uptrend. The pattern begins during a downtrend as prices create higher highs and lower lows in a broadening pattern. Then the trading range gradually narrows after the highs peak and the lows start trending upward. When the price breaks upward out of the diamonds boundary lines, it marks the resumption of the prior uptrend.