Tripadvisor Inc (NASDAQ: TRIP)

Trip Advisor, Inc., an online travel company, provides trip advisory services. The company’s travel research platform aggregates reviews and opinions from its community about destinations; accommodations, such as hotels, bed and breakfasts, specialty lodging, and vacation rentals; restaurants; and other activities through its TripAdvisor brand. It operates TripAdvisor-branded Websites, which comprise in the United States; and localized versions of the Website in 30 countries, including China under the brand In addition, it manages and operates Websites under 20 other travel media brands, providing travel planning resources across the travel sector; and engages in licensing its content. Further, TripAdvisor, Inc. operates, a hotel booking site that automatically rebooks hotel rooms at a lower price if the rate drops and automatically refunds the difference to the traveler’s credit cards; and, a flash sale Website that provides limited time access to deals on hotels at deep discounts.

To review Trip’s stock, please take a look at the 1-year chart of TRIP (Trip Advisor, Inc.) below with my added notations:

1-year chart of TRIP (Trip Advisor, Inc.)

After a strong rally from $30 in October, TRIP has formed a solid support at $60 (green) over the last (2) months. In addition, the stock has formed a trendline of resistance (navy) starting in the middle of June. These two levels combined have TRIP sandwiched within a common chart pattern known as a descending triangle. At some point, the stock will have to break through one of those two levels. If TRIP were to break through the resistance, the run could be short lived due to another resistance at $65 (red) standing in its way.

The Tale of the Tape: TRIP has a $65 resistance and a $60 support level to watch. A long trade could be made on a breakout above the resistance or on a pullback to the support. A break below the $60 support would be an opportunity to enter a short trade.

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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