Bulls taking Control of Baxter International?

Published on Tuesday, 18 September 2012 04:51 Written by TradersHuddle Wire

New York, September 18th (TradersHuddle.com) - Shares of Baxter International, Inc. (NYSE:BAX) ended the trading session higher by $0.47 or 0.78% from its previous close. Baxter'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.

Baxter International Inc. (NYSE:BAX) develops, manufactures, and markets products and technologies related to hemophilia, immune disorders, infectious diseases, kidney disease, trauma and other chronic medical conditions. The healthcare products are used by hospitals, kidney dialysis centers, nursing homes, rehabilitation centers, doctors' offices, and research laboratories.

Baxter's recent stock range was formed by a trough where calculated support was defined at $49.73 and by a peak that established the resistance level at $61.21. This range could be used by traders managing their positions.

Traders wanting to establish a position in Baxter International 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: