ResMed Inc. (NYSE: RMD)

ResMed Inc. develops, manufactures, distributes, and markets medical equipment for the diagnosis, treatment, and management of respiratory disorders, with a focus on sleep-disordered breathing. Its products portfolio includes airflow generators, diagnostic products, mask systems, motors, and headgear, as well as other accessories, such as cold passover humidifiers, carry bags, and breathing circuits; and humidifiers comprising H5i and H4i, which connect with the continuous and variable positive airway pressure, and AutoSet flow generators to humidify and heat the air delivered to the patient to prevent the drying of nasal passages.

Take a look at the 1-year chart of ResMed (NYSE: RMD) below with added notations:

1-year chart of ResMed (NYSE: RMD)

After moving significantly higher from March until June, RMD has since moved into a large sideways range. During that time the stock has also created a strong resistance at 53.50 (purple). RMD bottomed at $46 for a second time back in October and now appears to be making another run towards 53.50.

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The Tale of the Tape: RMD has a 52-week resistance at $53.50. The possible long position for the stock would be on a breakout above $53.50.

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

Follow me on Twitter: @cmtstockcoach