Macy's - Traders Waiting for Entry

Published on Monday, 02 July 2012 04:21 Written by TradersHuddle Wire

New York, July 2nd (TradersHuddle.com) - Shares of Macy's, Inc. (NYSE:M) closed the trading day higher by $0.88 or 2.63% from its previous close. Macy's, Inc. price action formed what is considered to be a doji close, where the open and close prices are very close to each other, mainly signaling an indecision between buyers and sellers.

Macy's, Inc. (NYSE:M) operates department stores in the United States. The New York, NY based company also operates direct mail catalog and electronic commerce subsidiaries. Macy's retail stores sell a wide range of merchandise, including men's, women's and children's apparel and accessories, cosmetics, home furnishings and other consumer goods.

Macy's, Inc. trading range is defined by a trough, which marked calculated support at $32.70 and by a peak that set the resistance point at $37.32. These levels are closely watched by traders managing their positions.

Traders wanting to establish a position in Macy's or traders that are already holding the stock can use the doji close to their advantage, since the pattern present a short-term pause in the stock's price action. This pause results in an entry point for traders depending of which way the stock resolves this short-term indecision.

The Doji is an important candlestick pattern that provides information on their own and as components in a number of important patterns. Doji form when a security's open and close are virtually equal. The length of the upper and lower shadows can vary and the resulting candlestick looks like a cross, inverted cross or plus sign. Alone, doji are neutral patterns.

Any bullish or bearish bias is based on preceding price action and future confirmation. In the case of Macy's, given that the stock finished the session higher, bulls should monitor their positions for confirmation that the stock will continue higher by taking its intraday high. Below a Doji illustration: