Boston Scientific Corporation (NYSE: BSX)

Boston Scientific Corporation develops, manufactures, and markets medical devices for use in various interventional medical specialties worldwide. The company operates in three segments: Cardiovascular, Rhythm Management, and MedSurg. It offers interventional cardiology products, including coronary stent systems used in the treatment of coronary artery disease; coronary technology products used to treat patients with atherosclerosis; intraluminal catheter-directed ultrasound imaging catheters and systems for use in coronary arteries and heart chambers, as well as peripheral vessels; and structural heart therapy systems.

To review Boston’s stock, please take a look at the 1-year chart of BSX (Boston Scientific Corporation) below with my added notations:

1-year chart of BSX (Boston Scientific Corporation)

BSX has been trading sideways for the last 5 months. Over that period of time the stock has formed a resistance area around $14 (red). In addition, the stock has also created a strong level of support at $12.50 (blue) that was also a resistance back in October. At some point the stock will have to break out of its current consolidation.

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The Tale of the Tape: BSX has levels of support at 12.50 and resistance at $14. The possible long positions on the stock would be either on a pullback to $12.50, or on a breakout above $14. The ideal short opportunity would be on a break below $12.50.

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

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