Charter Communications, Inc. (NASDAQ: CHTR)

Charter Communications, Inc., through its subsidiaries, provides cable services in the United States. The company offers various entertainment, information, and communications solutions to residential and commercial customers. Its video service offerings include a package of basic video programming, video on demand, subscription on demand, pay-per-view, high definition television, digital video recorder, Spectrum TV app on mobile devices, Spectrum TV app on immobile devices, and Spectrum guide services. The company also provides Internet services, such as residential Internet services; Charter.net, an Internet portal that provides multiple e-mail addresses; and Charter Security Suite that protects computers from viruses and spyware, as well as offers parental control features.

Take a look at the 1-year chart of Charter (NASDAQ: CHTR) below with the added notations:

1-year chart of Charter (NASDAQ: CHTR)

CHTR has been trending higher, overall, for the past nine months. During the most recent two months, the stock created a support level at $250 (green). In addition, a potential trendline of support (blue) starts from the stock’s February low. The break of the $250 support, and the trendline, most likely means lower prices, overall, are coming.

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The Tale of the Tape: CHTR has a level to watch at $250, and a broken trendline of support. A trader could enter a short position on any rallies up to the $250 area, with a stop placed above it. However, a break back above $250 most likely means higher prices 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!

Good luck!

Christian Tharp, CMT

Follow me on Twitter: @cmtstockcoach