HWM has pulled back to historical support on the charts
Howmet Aerospace Inc (NYSE: HWM) pulled back after hitting a record high of $310.00 on Aug. 6, though the shares quickly found support at the $225 level, which also coincides with the 320-day moving average. The stock could soon bounce off this trendline too, if history is any indication.
Per Schaeffer's Senior Quantitative Analyst Rocky White, HWM has traded within 0.75 times the 320-day moving average's 20-day average true range (ATR), after spending at least 80% of the previous two weeks and 80% of the prior 42 trading sessions above the trendline. This setup has occurred three other times over the last decade, after which the stock was higher one month later every time, averaging an 11.3% gain.
Short-term options traders have been more pessimistic than usual, too, per HWM's Schaeffer's put/call open interest ratio (SOIR), which sits higher than 93% of readings from the past 12 months. Plus, its 14-day Relative Strength Index (RSI) of 35 is nearing "oversold" territory.