Bulls in Charge of Green Mountain Coffee

Published on Friday, 13 May 2011 04:03 Written by Christopher Lynn

New York, May 13th (TradersHuddle.com) - Shares of Green Mountain Coffee Roasters, Inc. (NASDAQ:GMCR) ended the trading session flat by $0 or 0% from its previous close. Green Mountain's price action formed what is considered to be a bullish engulfing candle that could very well signal continuation of trend or reversal on ongoing weakness.

Green Mountain Coffee Roasters, Inc. (NASDAQ:GMCR) is recognized for its award-winning coffees, innovative brewing technology and socially responsible business practices. The Company maintains two business units: the Specialty Coffee Business Unit, which includes the Green Mountain Coffee? and Tully?s Coffee? brands, and the Keurig Business Unit. The Specialty Coffee business unit produces coffee, tea and hot cocoa from its family of brands, including Tully?s Coffee?, Green Mountain Coffee? and Newman?s Own? Organics coffee. The Keurig business unit is a pioneer and leading manufacturer of gourmet single-cup brewing systems and markets its premium patented single-cup brewing systems for consumers at home and away-from-home. K-Cup? portion packs for Keurig? Single-Cup Brewers are produced by a variety of licensed brands, including Green Mountain Coffee and Tully?s Coffee.

Green Mountain's recent stock range has been formed by a trough where calculated support was defined at $63.05 and by a peak that established the resistance level at $78.45, which could be used by traders planning their trades.

Traders wanting to establish a position in Green Mountain Coffee or traders that are already holding the stock can use the bullish engulfing pattern to their advantage. The pattern provides a defined risk as it shows where the bears were able to push the stock down, before the bulls stepped in.

The bullish engulfing pattern is a leading indicator that provides an alert to the bulls that the trend will continue or that there is an immediate reversal to the short term weakness seen on the stock. Below an Engulfing Bullish Candle Illustration: