Yahoo Finance After Golden Cross, NextEra Energy (NEE)'s Technical Outlook is Bright
After reaching an important support level, NextEra Energy, Inc. (NEE) could be a good stock pick from a technical perspective. NEE recently experienced a "golden cross" event, which saw its 50-day simple moving average breaking out above its 200-day simple moving average.
A golden cross is a technical chart pattern that can signify a potential bullish breakout. It's formed from a crossover involving a security's short-term moving average breaking above a longer-term moving average, with the most common moving averages being the 50-day and the 200-day, since bigger time periods tend to form stronger breakouts.
There are three stages to a golden cross. First, there must be a downtrend in a stock's price that eventually bottoms out. Then, the stock's shorter moving average crosses over its longer moving average, triggering a positive trend reversal. The third stage is when a stock continues the upward momentum to higher prices.
This kind of chart pattern is the opposite of a death cross, which is a technical event that suggests future bearish price movement.
NEE could be on the verge of a breakout after moving 9.3% higher over the last four weeks. Plus, the company is currently a #2 (Buy) on the Zacks Rank.
Once investors consider NEE's positive earnings outlook for the current quarter, the bullish case only solidifies. No earnings estimate has gone lower in the past two months compared to 6 revisions higher, and the Zacks Consensus Estimate has increased as well.
Investors should think about putting NEE on their watchlist given the ultra-important technical indicator and positive move in earnings estimates.
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