Visa (NYSE: V)

Visa Inc. operates as a payments technology company worldwide. The company facilitates commerce through the transfer of value and information among consumers, merchants, financial institutions, businesses, strategic partners, and government entities.

Take a look at the 1-year chart of Visa (NYSE: V) below with my added notations:

Over the past 6 months, V has formed a trend line of support (blue), which has been tested multiple times. During the shorter-term, the stock has also created key support at $120 (green). If the $120 level breaks, traders could possibly expect a fall down to the trendline.

The Tale of the Tape: V has both a trend line and $120 level of support. A long position could be entered on a pullback to $120, with a stop placed below the level of entry. A short position could be entered if V were to break below the $120 level, with an expectation of a fall down to the trendline.

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