ADP Near to the 50 and 200 Day Moving Averages

Published on Tuesday, 13 December 2011 17:56 Written by Christopher Lynn

New York, December 13th (TradersHuddle.com) - Shares of Automatic Data Processing, Inc. (NYSE:ADP) closed the trading session at $51.44 near its 50 day and 200 day moving averages currently set at $50.92 and $51.15 respectively. ADP's price action is above these important levels, which could translate into a trading opportunity.

Automatic Data Processing, Inc. (NYSE:ADP) is a global provider of business outsourcing solutions. The Company's services include a wide range of human resource, payroll, tax and benefits administration solutions. Automatic Data also provides solutions to auto, truck, motorcycle, marine and recreational vehicle dealers. Its solutions enable employers to staff, manage, pay, and retain their employees in the United States, Canada, Europe, South America, Australia, and Asia. The Professional Employer Organization Services segment provides employment administration outsourcing solutions, including payroll, payroll tax filing, HR guidance, and 401(k) plan administration for employees primarily in the United States.

Although the price action is above important moving averages, it's important to highlight that the 50 day moving average is currently below the 200 day moving average resulting in not a prime setup where buying the dip will present a good trading opportunity.

Looking at peaks and troughs horizontal support and resistance levels, we can see current calculated support at $47.60 and calculated resistance at $52.49. These levels should also be evaluated by traders when planning their trades, as they provide an insight into the latest price action.

If traders want to establish a position on ADP, should evaluate their trade, as it will certainly be better to wait, given that the stock is technically broken with the 50 day moving average trading below the 200 day moving average. Traders can also look at the current range defined by the peaks and troughs see where the current price action of stock is and establish a short trade versus those levels.