On the heels of a sharp two-week fall, Alcoa Inc. (NYSE:AA) has been chopping sideways for the last month. Technical analysis tells us that this chart pattern is a bear flag formation. Bear flags on the charts represents price consolidation that occurs before the resumption of the previous move.
Target Price
Since the previous move was sharply to the downside, it's pretty safe to see further downside on the horizon. The downside target on this trade would be $6.75, marking a fall of over 30% from current levels. Note the chart below.