SIACharts Logo

Commentary >

Southern Company - (SO) - October 13, 2022

A relative strength uptrend for electric and gas utility Southern Company (SO) appears to have come to an end. Between December and September, SO steadily climbed up the rankings of the SIA S&P 100 Index Report, rising from deep in the red zone up into the green zone. Yesterday it fell out of the green zone into the Yellow Neutral Zone for the first time since April after dropping 7 spots to 30th place. SO is down 23 positions in the last month. Trading action in Southern Company (SO) provides an example of how “stocks go up like an escalator, and down like an elevator”. For 2 1/2 years following the March 2020 market bottom, SO steadily advanced in a rising channel of higher highs and higher lows, a sign of consistent accumulation.

Last month, that uptrend ran out of gas near $80.00 and in the last few weeks, the shares have dropped off sharply, falling through the bottom of their previous channel, and then taking out a previous low near $65.00 (which reverses polarity to become new resistance), to signal the start of a new downtrend.

Next potential support tests appear at previous lows near $58.00 then $52.50, followed by the $50.00 round number.

An uptrend which had lasted over a decade in Southern Company (SO) shares appears to have come to an end with SO staging a major breakdown this month. Through the nine months of this year, SO continued to climb upward while the general direction of travel for stocks was downward.

Last month, SO rallied to a new all-time high but recently, it has turned sharply downward, completing a bearish Double Bottom breakdown. A decline of one more row would complete a bearish spread double bottom pattern and confirm the start of a new downtrend.

Next potential support appears at a recent column low near $57.55, then $55.30 based on a horizontal count, and then the $50.00 round number. Initial resistance has dropped toward $67.45 based on a 3-box reversal.

With a bearish SMAX score of 3, SO is exhibiting weakness against the asset classes.

Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.

Related Posts

Keep up to date on the latest financial market news.

Receive a daily newsletter with stock highlights, ETF rankings, weekly market focus and others.