Monster Beverage Corp (NASDAQ: MNST)

Monster Beverage Corporation, through its subsidiaries, develops, markets, sells, and distributes energy drink beverages, soda, and its concentrates in the United States and internationally. It operates through three segments: Monster Energy Drinks, Strategic Brands, and Other.

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

1-year chart of Monster (NASDAQ: MNST)

After holding support at $62 (blue) for a few months earlier in the year, MNST lost more than 20 percent of its value. Then, after bottoming in May, the stock started a rally that has taken it back to the key mark of $62. A break through that price should lead to higher prices for MNST.

The Tale of the Tape: MNST has a key level at $62. Traders could enter a long position on a break back above that level, with a stop placed below it. However, traders that are bearish on the stock might have an opportunity to get short if MNST were to rally back up to $62.

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