Trading Idea - Is Cognizant Technology Solutions close to Resistance?

Published on Tuesday, 17 January 2012 09:32 Written by Christian Paolinetti

New York, January 17th (TradersHuddle.com) - Shares of Cognizant Technology Solutions Corporation (NASDAQ:CTSH) are trading very close to calculated resistance at $70.72 with the current price action closing at just $68.34 placing the stock near levels that make it difficult to buy.

Cognizant Technology Solutions Corporation (NASDAQ:CTSH) provides custom Information Technology (IT) consulting and technology services as well as outsourcing services. The Company focus in technology strategy consulting, complex systems development, and enterprise software package implementation.

Cognizant's current stock range is defined by current calculated support defined at $62.96 and by the resistance level at $70.72, the stock is clearly over-extended from support, making it difficult to establishing new long positions at this level.

Traders don't have a clear entry point for Cognizant Technology Solutions, as the stock is well above support, however, as the stock pulls back towards $62.96 it will definitely provide a reference point to establish a trade. On the other hand if the stock decides to break above resistance level at $70.72 then traders will get an opportunity to enter Cognizant Technology Solutions stock by establishing a position as the stock moves to a higher range.