Nimble Storage Inc (NYSE: NMBL)

Nimble Storage, Inc. provides flash-optimized hybrid storage platform. The company’s software and storage systems handle various mainstream applications, including virtual desktops, databases, email, collaboration, and analytics. It offers systems that provide adaptive performance for high-input/output and high-capacity mainstream business applications and environments, such as Exchange, Oracle, SharePoint, SQL Server, virtual desktop infrastructure, and server virtualization. The company sells its products through a network of value added resellers and distributors to a range of industries comprising cloud-based service providers, education, financial services, healthcare, manufacturing, state and local government, and technology worldwide. Nimble Storage, Inc. was incorporated in 2007 and is headquartered in San Jose, California.

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

1-year chart of Nimble (NYSE: NMBL)

NMBL fell right off the cliff back in March, April and May before finally settling into a very long, sideways trend that has lasted about 10 months. During the sideways move the stock has shown a tendency to find repeated support at $25 (blue). Whenever that level was to break, the stock would fall to the next level down at $22 (red). NMBL is currently sitting right at $25.

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The Tale of the Tape: NMBL has key levels at $22 and $25. A trader could enter a long position at $25 with a stop placed under the level. However, a short trade could be made instead if the stock were to break below $25 with the expectation of a fall down to $22. Another long trade could be considered if the fall to $22 were to happen.

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