NRG Energy, Inc.

NRG Energy, Inc. (NYSE: NRG) is a consumer services company, which is engaged in producing and selling energy and related products and services, nationwide in the United States and Canada. The Company sells power, natural gas, and home and power services; and develops sustainable solutions under the brand names NRG, Reliant, Direct Energy, Green Mountain Energy, Stream and XOOM Energy. Noted below are the key price indicators for the stock:

Technical Observation (on the Weekly Chart)

On the weekly chart, stock price of NRG is trading in rising channel pattern and taking the support at the lower band of the channel. The recent upside movement in the stock is backed by volumes, further supporting a positive bias in the price action. Now the next resistance level for the stock appears at USD 45 and this may get tested in the coming sessions. A further breakout above USD 45, backed by volumes, may extend buying in the stock.

Source: REFINITIV, Analysis: Kalkine Group

The CMP is above the trend-following 21-period SMA (at USD 38.98) and 50-period SMA (at USD 39.37) further supporting the up move. The leading indicator RSI (14-period) is also trading in positive territory and is currently at the 51.71 level. The weekly volumes also seem supportive of an upside movement.

Conclusion

As per the above-mentioned price action and technical indicators analysis, we can conclude that NRG Energy, Inc is looking technically well-placed on the chart, and we have a ‘Speculative Buy’ rating on the stock at the close price of USD 39.55 (as of 08 April 2022). Investment decision should be made depending on an investor’s appetite for upside potential, risks, and any previous holdings. This recommendation is purely based on technical analysis, and fundamental analysis has not been considered in this report. 

Investors with an extremely high-risk appetite can consider investing in the stock based on the provided support and resistance levels as well as other risks associated. Markets are trading in a highly volatile zone currently due to certain macro-economic issues and g prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Investment Related Risks: This report may be looked at by Investors with sufficient risk appetite looking for returns within a short investment duration. Investment recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

Note 2: How to Read the Charts?

The Green colour line reflects the 21-period moving average while the red line indicates the 50- period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps in easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

The reference date for all price data, volumes, technical indicators, support, and resistance levels is April 08, 2022. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

RSI: Relative Strength Index

USD: United States dollar 

Note: Trading decisions require a thorough analysis by investors. Technical reports in general chart out metrics that may be assessed by investors before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.