Bulls taking Control - J. M. Smucker?

Published on Friday, 10 February 2012 09:06 Written by TradersHuddle Wire

New York, February 10th (TradersHuddle.com) - Shares of J. M. Smucker Company (NYSE:SJM) ended the trading session higher by $0.45 or 0.57% from its previous close. J. M. Smucker'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.

The J. M. Smucker Company (NYSE:SJM) manufactures and markets food products. Its principal products include peanut butter, shortening and oils, fruit spreads, canned milk, baking mixes and ready-to-spread frostings, flour and baking ingredients, juices and beverages, frozen sandwiches, dessert toppings, syrups, pickles and condiments, and potato side dishes.

J. M. Smucker's recent stock range has been formed by a trough where calculated support was defined at $71.24 and by a peak that established the resistance level at $81.21, which could be used by traders planning their trades.

Traders wanting to establish a position in J. M. Smucker 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: