VeriFone Systems Inc. (NYSE: PAY)

Verifone Systems, Inc. designs, markets, and services electronic payment solutions worldwide. It provides countertop electronic payment systems that accept magnetic, smart card, contactless or radio frequency identification cards, and near field communication (NFC) payment options, as well as support credit, debit, check, EBT, and pre-paid products; an array of software applications and application libraries; and mobile solutions that support CDMA, GPRS, Bluetooth, and WiFi technologies. The company also offers products for consumer-facing functionality at the point of sale; contactless/NFC payment solutions consisting of contactless readers for consumer-facing transactions for indoor and outdoor payment system solutions; and integrated electronic payment systems that combine electronic payment processing, fuel dispensing, and ECR functions, as well as payment systems for integration. In addition, it provides server-based payment processing software and middleware; a line of payment hardware and software integration modules that enable self-service solutions; retail bank branch solutions; mass transportation solutions; network access solutions; and mobile retail software. F

Please take a look at the 6-month chart of PAY (Verifone Systems, Inc.) below with my added notations:

6-month chart of PAY (Verifone Systems, Inc.)

Back in February PAY took a massive drop from $32 down to $18. Since that drop, the stock has shown a very clear trading pattern. First, you can see the $22 resistance (blue) that PAY had been hitting for (2) months. Outside of that level you will notice that $18, $20 and now $24 have also been areas of support and resistance (red). Bottom line is that PAY is showing that it tends to react to each $2 increment.

The Tale of the Tape: PAY is currently trading between its $22 and $24 levels. A long position could be entered on a pullback to $22 with a stop set below the level of entry. If you were looking for short trades on PAY instead, a break below $22 should provide you with that opportunity.

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