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Duke Energy Stock Approaches Overbought Zone

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Mar. 27 2017, Published 3:51 p.m. ET

Chart indicators

Duke Energy (DUK) stock looks stable going forward, as it trades with a fair premium to its moving average levels. On March 24, 2017, Duke stock was trading 4% above its 50-day and 200-day moving average (or DMA) levels. Its 50-DMA levels near $79.50 may now act as a support in the short term.

Moving averages show that when a stock price rises above or falls below a particular moving average, it’s a bullish or bearish sign, respectively.

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Relative strength index

Currently, Duke Energy’s RSI (relative strength index) stands at 68, which could be approaching the “overbought” zone. RSI is a momentum indicator that consists of values between 0 and 100. Movements below 30 are in the “oversold” zone, while movements above 70 are in the “overbought” zone. Extreme RSI levels could indicate an imminent reversal.

Short interest

Short interest in Duke Energy rose more than 11% on March 15, 2017. Total shorted shares in the company were 9.8 million on February 28, 2017, and rose to 11 million by mid-March 2017. A rise in short interest can mean that more investors are expecting the stock to fall in the near term.

Remember, short interest indicates the number of a company’s shares that have been sold short and haven’t been covered. The number also helps track investor sentiment.

Read about what’s happening with Southern Company (SO), another utility (XLU) giant, in Can Southern Company Overcome Its Newest Challenges?

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