Prudential Financial, Inc., through its subsidiaries, provides insurance, investment management, and other financial products and services in the United States and internationally. It offers primarily life insurance, annuities, retirement-related, mutual funds, and investment management products and services. The company operates through U.S. Retirement Solutions and Investment Management, U.S. Individual Life and Group Insurance, and International Insurance divisions.
Take a look at the 1-year chart of Prudential (NYSE: PRU) below with the added notations:
During the past 5 months, the $75 price level (blue) has become very important to PRU. Not only was $75 a support level back in January, but that level was also resistance in the middle of March. In addition, the $75 level has already been support several times again since mid-April.
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The Tale of the Tape: PRU is sitting right on the key level of $75. A trader could enter a long position on a pullback down to $75 with a stop placed under the level. However, if traders are bearish on the stock, a short trade could be made if the stock breaks back below $75.
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