Why NRG Energy Stock Continues to Look Strong



NRG Energy’s chart indicators

NRG Energy (NRG) stock has risen the most among the S&P 500 Utilities Index (XLU) this year. The stock continues to look strong. On October 9, 2017, NRG Energy stock was trading 4% and 34% above its 50-day and 200-day simple moving average levels. Its 50-day moving average level of ~$24.69 is expected to act as a support in the short term. Currently, it’s trading at $25.74. The fair premium to both its key moving average levels highlight strength in the stock. The stock will likely trade strong until it crosses below both of these moving average levels.

Simple moving average levels show that when a stock price increases above or decreases below a particular moving average, it’s a bullish or bearish sign, respectively.

NRG dma

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Relative strength index

The RSI (relative strength index) of NRG Energy stock is at 67 and approaching the “overbought” zone.

Technical analysts consider RSI levels above 70 to be in the “overbought” zone, while RSI levels below 30 are considered to be in the “oversold” zone. Extreme RSI levels might follow with a trend reversal in the stock.

It should be noted that despite its tiny dividend yield, NRG Energy thrashed broader utilities with its epic ascent. In the past year, the Utilities Select Sector SPDR ETF (XLU) returned 13%, while NRG Energy returned 135%.

Read What Does the Recent Recovery in Utilities Mean? to learn how utilities traded last week.

In the next part, we’ll discuss NRG Energy’s target prices and analysts’ views.


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