Intuit, Inc. provides business and financial management solutions for small businesses, consumers, accounting professionals, and financial institutions primarily in the United States, Canada, the United Kingdom, India, and Singapore. It offers QuickBooks financial and business management software and services, technical support, financial supplies; Demandforce, which provides online marketing and customer communication solutions; payroll products and services; merchant services, including credit and debit card processing. The company also provides TurboTax income tax preparation products and services for consumers and small business owners; Lacerte and ProSeries professional tax products and services; and QuickBooks Premier Accountant Edition and the QuickBooks ProAdvisor Program for accounting professionals. The company sells its products and services through various sales and distribution channels, including Websites, promotions, call centers, and retail locations, as well as through alliance partners, principally consisting of banks, credit unions, and securities and investment firms.
Please take a look at the 1-year chart of INTU (Intuit, Inc.) below with my added notations:
INTU is not a very big moving stock, but it’s moves are somewhat predictable. Over the last (3) months the stock has been clearly resisting $60 (blue). For the last (2) months the stock has held a $58 support (green). In addition to those two levels, INTU has an upper level of resistance at $62 (brown) and a lower level of support commonly at $56 (red). So, although the stock’s moves are small for a $60 stock, it’s levels are clear and commonly on each $2 increment.
The Tale of the Tape: INTU finds each $2 increment important. If the stock pulls back to the $58 support, or breaks above $60, you could enter a long play. If it rallies back up to $60, or breaks below $58, you could enter a short play. Depending on the direction of an eventual break, the levels of $56 or $62 would come back into play.
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!
Christian Tharp, CMT