Take a look at the 1-year chart of Whiting (NYSE: WLL) below with the added notations:
WLL has been working its way lower over the course of the past year. In the process, the $20 price level (blue) has become very important to the stock over the past 3 months. The $20 level not only provided WLL with support at the end of July, but that level was also a key resistance back in August. Now, the stock is back above that $20 level.
The Tale of the Tape: WLL has a key level at $20. A trader could enter a long position on a pullback down to $20 with a stop placed under the level. However, if traders are bearish on the stock, a short trade could be made instead if the stock breaks back below $20.
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