AT&T (T) – Get Free Report has been a love-hate stock over the years, including this one.
The stock tends to boast a big dividend yield and low valuation, but elevated debt levels and low growth have kept investors from gobbling up the stock.
Earlier this year, the company split off its HBO unit via Warner Bros Discovery (WBD) – Get Free Report.
The bulls were hopeful that the move would unlock value and trigger a move higher in both WBD and AT&T stock.
Instead, both stocks have remained under pressure for much of the year. So has Verizon (VZ) – Get Free Report.
In September, however, it became clear that AT&T stock could not go down forever and I outlined the key support area of $15.
The shares ultimately bottomed at $14.46, and after a wonderful bounce, the stock has been consolidating in a very tight range for weeks now.
Let’s take a closer look.
Trading AT&T Stock
Weekly chart of AT&T stock.
Chart courtesy of TrendSpider.com
I was looking for a rally into the upper-$18s and with AT&T pushing into the $19s, it satisfied that outlook. From here, the recent range can help us as well.
The stock is trading between $18.75 support and $19.50 resistance. Coming into play near resistance is the 21-month moving average, while the 50-week moving average has been support.
On the downside, keep a close eye on $18.50. A break of this level not only puts AT&T stock below the levels mentioned above, but also the rising 10-week moving average.
That could open the door to $17 to $17.50, and if the selling really picks up, the gap-fill down at $15.76 could be in play.
On the upside, lets see if we can get a sustained rally above $19.50 and the 21-month moving average.
That opens the door to the 78.6% retracement at $20, then potentially puts $21.50 and the declining 200-week moving average in play.
The recent rally aside, AT&T stock still pays a dividend yield of 5.8%. If the technicals cooperate, the bulls could cash in on a nice rally while also collecting a handsome dividend.
Keep an eye on a break of the current range: $18.75 to $19.50.
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