Bearish Trendline Could Ground American Eagle Stock

The stock has already shed more than 60% in the past 12 months

Digital Content Manager
Aug 15, 2022 at 12:23 PM
facebook X logo linkedin

The shares American Eagle Outfitters Inc (NYSE:AEO) have had a rough go of it this year. The security has shed 61.2% in the past 12 months, with a recent consolidation level emerging at the $13 mark. And while AEO is up slightly today, last seen at $12.85, with a more than 9% month-over-month lead under its belt, a historically bearish signal indicates that this could be a false start for the retail name. 

This is because AEO just came within one standard deviation of its 80-day moving average after a lengthy period below the trendline. Per data from Schaeffer's Senior Quantitative Analyst Rocky White, there have been five similar instances in the past three years. After 80% of these occurrences, the stock was lower, averaging a one-month drop of 10%. A similar move from its current perch would put AEO back below the $12 mark, and closer to its almost two-year low of $10.82 from late July. 

aeo aug 15

While the majority of analysts are lukewarm on American Eagle stock, it still looks susceptible to downgrades. Of the 12 in coverage, three still call the security a "strong buy." 

A shift in sentiment among options traders could also put pressure on the security. At the  International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), AEO sports a 10-day call/put volume ratio of 3.2, which stands higher than 75% of readings from the past 12 months. In other words, calls are being picked up at a quicker-than-usual clip of late. 


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI