Williams-Sonoma Bullish Signs

Published on Wednesday, 06 June 2012 04:12 Written by TradersHuddle Wire

New York, June 6th (TradersHuddle.com) - Shares of Williams-Sonoma, Inc. (NYSE:WSM) ended the trading session higher by $0.36 or 1.06% from its previous close. Williams-Sonoma's price action formed what is considered to be a bullish engulfing candle that could very well signal a continuation of trend or reversal of the ongoing weakness.

Williams-Sonoma, Inc. (NYSE:WSM) retails cooking and serving equipment, home furnishings, and home accessories through retail stores and mail order catalogs. The Company offers its merchandise under the Williams-Sonoma, Pottery Barn, Pottery Barn Kids, and West Elm concepts.

Williams-Sonoma's recent stock range was formed by a trough where calculated support was defined at $33.36 and by a peak that established the resistance level at $37.41. This range could be used by traders managing their positions.

Traders wanting to establish a position in Williams-Sonoma 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 step in with a bid.

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: