Approaching Resistance - SPDR S&P Metals & Mining

Published on Tuesday, 31 January 2012 09:14 Written by Christian Paolinetti

New York, January 31st (TradersHuddle.com) - Shares of SPDR S&P Metals & Mining ETF (NYSE:XME) are trading very close to calculated resistance at $56.80 with the current price action closing at just $54.95 placing the stock near levels that make it difficult to buy.

SPDR S&P Metals & Mining ETF (NYSE:XME) seeks to provide investment results that correspond to the price and yield performance of the S&P Metals & Mining Select Industry Index. The Index represents the metals and mining sub-industry portion of the S&P Total Market Index. The Fund invests in industries, such as steel, coal and consumable fuels, gold, precious metals and minerals, aluminum, and diversified metals and mining.

SPDR S&P Metals & Mining's current stock range is defined by current calculated support defined at $47.94 and by the resistance level at $56.80, the stock is clearly over-extended from support, making it difficult to establishing new long positions at this level.

Traders don't have a clear entry point for SPDR S&P Metals & Mining, as the stock is well above support, however, as the stock pulls back towards $47.94 it will definitely provide a reference point to establish a trade. On the other hand if the stock decides to break above resistance level at $56.80 then traders will get an opportunity to enter SPDR S&P Metals & Mining stock by establishing a position as the stock moves to a higher range.