Today’s Big Stock: Lazard Ltd (NYSE: LAZ)

Lazard Limited is a financial advisory and asset management company. The company serves a diverse set of clients around the world, including corporations, partnerships, institutions, and governments and high net worth individuals. The company has two business segments: Financial Advisory and Asset Management. The company operates from 41 cities in key business and financial centers across 26 countries throughout Europe, North America, Asia, Australia, the Middle East and Central and South America.

To analyze Lazard’s stock for potential trading opportunities, please take a look at the 1-year chart of LAZ (Lazard Limited) below with my added notations:

After peaking in March of last year, LAZ trended consistently lower until October. While moving sideways throughout the fall, the stock formed a key level of resistance at $30 (navy). Now trading above $30, that same level has been acting as support for the stock. The concern with LAZ is that although having broke higher, the stock has not been able to keep up with the overall market. Could one small market pullback be enough to cause LAZ to break support?

The Tale of the Tape: LAZ has a key level of support at $30. A long position could be entered on a pullback to $30 with a stop placed below the level of entry. However, the weakness in the stock could be a setup for a short trade if the stock were to break below the $30 level.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!
Christian Tharp, CMT