Brunswick Corporation designs, manufactures, and markets recreation products in the United States and internationally. The company’s Marine Engine segment offers outboard engines, sterndrive propulsion systems, and inboard engines under the Mercury, Mercury MerCruiser, Mariner, Mercury Racing, Mercury Sport Jet and Mercury Jet Drive, MotorGuide, Axius, and Zeus brands; and marine electronics and control integration systems, steering systems, instruments, controls, propellers, trolling motors, fuel systems, service parts, and marine lubricants under the Quicksilver, Mercury Precision Parts, Mercury Propellers, Attwood, Land N Sea, Kellogg Marine Supply, Diversified Marine Products, Bell Recreational Products, Sea Choice, and MotorGuide brands, as well as supplies integrated diesel propulsion systems.
Take a look at the 1-year chart of Brunswick (NYSE: BC) with the added notations:
BC has been trading sideways for all of 2015. Along the way, the stock has found support at $50 (green) several times. Now that the stock appears to be falling back down to that support level again, traders could expect some sort of bounce. However, if the $50 support were to break, lower prices should follow.
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The Tale of the Tape: BC has an important level of support at $50. A trader could enter a long position at $50 with a stop placed under the level. If the stock were to break below the support a short position could be entered 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!
Christian Tharp, CMT
Follow me on Twitter: @cmtstockcoach