CarMax, Inc (NYSE: KMX)

CarMax, Inc. is as a holding company, which engages in the retail of used vehicles and wholesale vehicle auction operator. It operates through the CarMax Sales Operations and CarMax Auto Finance (CAF) business segments.

Take a look at the 1-year chart of CarMax (NYSE: KMX) below with added notations:

KMX has hit the $100 mark as resistance on multiple occasions over the past few months. The stock now sits just a couple dollars below that level. A solid close above $100 should lead to another leg higher for KMX.

The Tale of the Tape: KMX has a key 52-week resistance at $100. A 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!

Good luck!
Christian Tharp, CMT