Herbalife Ltd. (NYSE: HLF)

Herbalife Ltd., a network marketing company, sells weight management, healthy meals and snacks, sports and fitness, energy and targeted nutritional products, and personal care products worldwide. It offers science-based products in four principal categories, including weight management; targeted nutrition; energy, sports, and fitness; and outer nutrition. The weight management product portfolio includes meal replacement, protein shakes, drink mixes, weight loss enhancers, and healthy snacks. The targeted nutrition products comprise dietary and nutritional supplements containing quality herbs, vitamins, minerals, and other natural ingredients. The energy, sports, and fitness products consist of products designed to meet the nutritional needs of athletes, such as Herbalife24 product line, which enables athletes to customize their nutrition program based on personal training and competitive demands throughout the day. The outer nutrition products include skin cleansers, toners, moisturizers, facial masks, shampoos and conditioners, body-wash items, and a selection of fragrances for men and women, as well as anti-aging products.

To analyze the company’s stock for potential trading opportunities, please take a look at the 1-year chart of HLF (Herbalife, Ltd.) below with my added notations:

1-year chart of HLF (Herbalife, Ltd.)

From September through the beginning of December HLF had been holding support at $45 (blue), which it eventually broke. Since then, the stock has rallied back up to that $45 breakdown level and hit it as resistance (red) on (3) separate occasions. A break back above that $45 level should mean higher prices for the stock.

The Tale of the Tape: HLF has a key level at $45. A long position could be entered on a break back above $45 with a stop placed under that level. Or, a short play could be made at $45.

Would you like assistance in making your TBS trades? If so, email me at Christian@yolopub.com and let’s talk about working together one on one!

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