3M Company operates as a diversified technology company worldwide. The company operates through its Industrial, Safety and Graphics, Health Care, Electronics and Energy, and Consumer segments. 3M Company serves automotive, electronics and energy, appliance, paper and printing, packaging, food and beverage, construction, clinics and hospitals, pharmaceuticals, dental and orthodontic practitioners, health information systems, food manufacturing and testing, consumer and office retail, home improvement, drug and pharmacy retail, and other markets.
Take a look at the 1-year chart of 3M (NYSE: MMM) below with added notations:
MMM had been in an overall uptrend from January til July. However, the stock eventually stalled, as MMM has repeatedly hit the same resistance at $180 (red). The stock is sitting just under that level now. A solid close above the $180 should lead to another leg higher for MMM.
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The Tale of the Tape: MMM has a 52-week resistance at $180. The possible long position on the stock would be on a breakout above that level with a stop placed under it.
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
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