Hewlett Packard Enterprise Co (NYSE: HPE)

Hewlett Packard Enterprise Company provides technology solutions to business and public sector enterprises. It operates through Enterprise Group, Software, Enterprise Services, and Financial Services segments. The company markets and sells its products through resellers, distribution partners, original equipment manufacturers, independent software vendors, systems integrators, and advisory firms. Hewlett Packard Enterprise Company is headquartered in Palo Alto, California.

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

1-year chart of Hewlett Packard (NYSE: HPE)

HPE has been trending lower since the stock began trading, but over the most recent 3 months the $14 price level (blue) has become very important to the stock. Not only was the $14 level a key support multiple times back in December, but that level has also been resistance in both February and March. If HPE can break above $14, that should open the door for a rally towards $15.50 (red).

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The Tale of the Tape: HPE has a key level at $14. A trader could enter a long position on a break above $14 with a stop placed under the level. However, if traders are bearish on the stock, a short trade could be made instead on a rally up to the $14 level.

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