Workday Inc (NYSE: WDAY)

Workday, Inc. provides enterprise cloud applications for global human resources and finance in the United States and internationally. It offers applications for customers to manage critical business functions that enable them to optimize their financial and human capital resources. The company was formerly known as North Tahoe Power Tools, Inc. and changed its name to Workday, Inc. in July 2005. Workday, Inc. was founded in 2005 and is headquartered in Pleasanton, California.

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

1-year chart of Workday (NYSE: WDAY)

After WDAY’s March and April decline, the stock has been trading mostly sideways since. Along the way, you will notice that the stock has created an important price level at $85 (green). That level has been both support and resistance several times over the last 6 months. For the last 2 months WDAY has repeatedly stalled at that $85 resistance, and a break through that mark should lead to higher prices.

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The Tale of the Tape: WDAY has a key level at $85. A trader could enter a long position on a break above $85 with a stop placed under the level. However, if traders are bearish on the stock, or the market overall, a short trade could be made at the $85 level instead.

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