Red Hat Had a Bearish Engulfing Candle

Published on Monday, 09 January 2012 19:42 Written by Christopher Lynn

New York, January 9th (TradersHuddle.com) - Shares of Red Hat, Inc. (NYSE:RHT) ended the trading session lower by $0.7 or -1.63% from its previous close. Red Hat's price action formed what is considered to be a bearish engulfing candlestick chart pattern.

Red Hat, Inc. (NYSE:RHT) develops and provides open source software and services, including the Red Hat Linux operating system.

Red Hat's current stock range is defined by calculated support defined at $39.19 and by the resistance level at $43.50, which should be used by traders planning their trades.

Traders wanting to establish a position in Red Hat stock need to pay close attention at the bearish engulfing pattern, since it could mark a trend reversal to current Red Hat 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: