PriceSmart Reversal Soon?

Published on Tuesday, 03 January 2012 04:03 Written by TradersHuddle Staff

New York, January 3rd (TradersHuddle.com) - Shares of PriceSmart, Inc. (NASDAQ:PSMT) ended the trading session lower by $1.06 or -1.5% from its previous close. PriceSmart's price action formed what is considered to be a bearish engulfing candlestick chart pattern.

PriceSmart, Inc. (NASDAQ:PSMT) is the largest operator of membership warehouse clubs in Central America and the Caribbean. The company owns and licenses membership warehouse stores using the trade name PriceSmart. Its warehouse clubs sell consumer goods and perishable foods at low prices to individuals and businesses, as well as offers ancillary services, which include food courts, tire centers, and photo centers. PriceSmart was founded in 1994 and is headquartered in San Diego, California.

PriceSmart's current stock range is defined by calculated support defined at $66.29 and by the resistance level at $70.86, which should be used by traders planning their trades.

Traders wanting to establish a position in PriceSmart stock need to pay close attention at the bearish engulfing pattern, since it could mark a trend reversal to current PriceSmart shares price action. The Bearish engulfing pattern is a leading warning sign, therefore traders should closely monitor price action for indications of a trend reversal. Below an Engulfing Bearish Candle Illustration: