Agilent Technologies, Inc. provides application focused solutions to the life sciences, diagnostics, and applied chemical markets worldwide.
Take a look at the 1-year chart of Agilent (NYSE: A) below with my added notations:
A has been in an uptrend for the entire year. However, the stock did consolidate a bit during the summer. Since moving out of that range, A has had a tendency of creating support and resistance levels at the increments of $2 (blue). Not only could traders expect a bounce off the recent $66 level, but knowing how the stock moves could also provide trading opportunities in the future.
The Tale of the Tape: A tends to react to each $2 increment. A long trade could be made on a break through $68, or on a pullback to $66, with a stop placed under the level of entry. A short trade could be made on a break below $66.
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