Under Armour, Inc., together with its subsidiaries, develops, markets, and distributes branded performance apparel, footwear, and accessories for men, women, and youth primarily in North America, Europe, the Middle East, Africa, Asia, and Latin America. The company sells its products through wholesale channels, including national and regional sporting goods chains, independent and specialty retailers, department store chains, institutional athletic departments, and leagues and teams, as well as independent distributors; and directly to consumers through a network of brand and factory house stores, and Website. Under Armour, Inc. was founded in 1996 and is headquartered in Baltimore, Maryland.
Take a look at the 1-year chart of Armour (NYSE: UA) below with the added notations:
UA has created a couple of important price levels to watch. First, UA has formed a clear resistance at $73 (red), which would also be a 52-week high breakout if the stock could manage to break above it. In addition, the stock is climbing an up-trending support level (blue) over the last 6 months. These two levels combined have UA stuck within a common chart pattern known as an ascending triangle. Eventually, the stock will have to break one of those (2) levels.
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The Tale of the Tape: UA has an up trending support and a 52-week resistance level to watch. A long trade could be made on a pullback to the support, or on a break above $73. A break below the up trending support would be an opportunity to enter a short trade.
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!
Christian Tharp, CMT
Follow me on Twitter: @cmtstockcoach