Coca-Cola Enterprises Inc (NYSE: CCE)

Coca-Cola Enterprises, Inc. produces, distributes, and markets nonalcoholic beverages. It provides still and sparkling waters, flavored waters, juice and juice drinks, sports drinks, energy drinks, teas, and coffees. The company offers its products primarily under Coca-Cola, Diet Coke/Coke Light, Fanta, Coca-Cola Zero, Capri-Sun, Schweppes, Sprite, Chaudfontaine, Minute Maid, Oasis, Dr. Pepper, Monster, Nalu, Relentless, and POWERade Energy brands. It distributes its products through retailers, wholesalers, and other customers; and through licensed territory agreements in Belgium, continental France, Great Britain, Luxembourg, Monaco, the Netherlands, Norway, and Sweden.

To review Coca-Cola’s stock, please take a look at the 1-year chart of CCE (Coca-Cola Enterprises, Inc.) below with my added notations:

1-year chart of CCE (Coca-Cola Enterprises, Inc.)

Over the last (10) months CCE has trended overall higher, while during the most recent several months the stock has formed a trend line of support (green). Always remember that any (2) points can start a trend line, but it’s the 3rd test and beyond that confirm its relevance. However, the stock also had a key level of support at $46 (red) that should act as resistance if CCE’s rally continues.

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The Tale of the Tape: CCE has a trend line support and a $46 resistance. A long position could be entered on a break above $46, or on a pullback to the trendline, with a stop placed below the level of entry. A short position could be entered if CCE were to break below trendline or if the rally continues up to $46.

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

Follow me on Twitter: @cmtstockcoach