Teradata Corporation (NYSE: TDC)

Teradata Corporation provides analytic data platforms, marketing and analytic applications, and related consulting services in the United States and internationally. Its analytic data platforms comprise software, hardware, and related business consulting and support services for data warehousing, active intelligence, big data analytics, and data discovery. The company’s products comprise Teradata Analytic Database Software that delivers near real-time intelligence; Teradata Workload-Specific Platforms; Teradata Aster Discovery Platform, which is pre-configured with Teradata Aster Database; and Teradata Logical Data Models that are blueprints for designing an integrated data warehouse.

Review the 1-year chart of Teradata (NYSE: TDC) below with my added notations:

1-year chart of Teradata (NYSE: TDC)

TDC has formed a key level of support at $40.00 (blue) over the last 8 months. In addition, the stock has created a down trending resistance starting from the beginning of April (red). These two lines combined have TDC stuck trading within a common chart pattern known as a descending triangle, and at some point, the stock has to break support or break its string of lower highs.

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The Tale of the Tape: TDC has formed a descending triangle pattern. A short trade could be made on a break of the $40.00 support level. A break through $43.00 would break the down trending resistance and would set up a potential long trade. A long trade could also be made on a pullback to $40.

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