CarMax, Inc., through its subsidiaries, operates as a retailer of
used vehicles in the United States. It operates in two segments, CarMax
Sales Operations and CarMax Auto Finance. The company sells vehicles
that do not meet its retail standards to licensed dealers through
on-site wholesale auctions, as well as sells new vehicles under
franchise agreements. It also provides customers financing alternatives
through its finance operation, CarMax Auto Finance, as well as through
its third-party financing providers. In addition, the company offers a
range of other related products and services, including the sale of
extended service plans, guaranteed asset protection, and accessories;
the appraisal and purchase of vehicles directly from consumers; and
vehicle repair services. As of April 10, 2013, it had 119 used car
superstores in 59 markets. The company was founded in 1993 and is based
in Richmond, Virginia.
To review CarMax's stock, please take a look at the 1-year chart of KMX (CarMax, Inc.) below with my added notations:
Over the last 12 months KMX has consistently moved higher. Since
October though, the stock has formed a nice trendline of support (navy).
Always remember that any (2) points can start a trendline, but it's the
3rd test and beyond that confirm its importance. Obviously KMX's
trendline is important to the stock since it has been tested on multiple
occasions over the last(8) months.
The Tale of the Tape: KMX has created a nice
trendline of support over the last (8) months. A long position could be
entered on a pullback to that trendline, which is approaching $44, with a
stop placed below that level. A short position could be entered if KMX
were to break the trend line support.
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