Trade Lesson: Short On Break Of Support
American Axle & Manufacturing Holdings, Inc. (AXL) is a Tier I supplier to the automotive industry. AAM manufactures, engineers, designs and validates driveline and drivetrain systems, and related components and chassis modules for light trucks, sport utility vehicles, passenger cars, crossover vehicles and commercial vehicles. Driveline and drivetrain systems include components that transfer power from the transmission and deliver it to the drive wheels.
AXL has been trading above @6 for the last week. The lesson to learn is when the big support of @6 is broken on the downside, this becomes a good short entry. Stop losses get triggered pushing the stock down further.
I shorted @5.91 and covered @5.55 when it failed to break @5.50 support.
