Juniper Networks, Inc. designs, develops, and sells network products and services worldwide. It offers various routing products, including ACX series universal access routers to deploy new high-bandwidth services; MX series Ethernet routers that functions as a universal edge platform; M series edge routers; PTX series packet transport routers; T series routers; and NorthStar controllers. The company also provides various switching products comprising EX series Ethernet switches to address the access, aggregation, and core layer switching requirements of micro branch, branch office, and campus and data center environments; QFX series of core, spine, and top-of-rack data center switches.
Take a look at the 1-year chart of Juniper (NYSE: JNPR) below with the added notations:
JNPR has been making its way lower since the beginning of November. After getting a small bounce off $25 in mid-January, the stock made its way even lower, ultimately finding support just above $21. JNPR has rallied since that low, but for the past two weeks the stock has been hitting the previous $25 support as resistance. On Friday, JNPR finally broke above that $25 mark.
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The Tale of the Tape: JNPR has a key level at $25. A trader could enter a long position on a pullback to $25 with a stop placed under the level. However, if traders are bearish on the stock, a short trade could be made instead if the stock broke back below the $25 mark.
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