Reference Points for Adobe

Published on Wednesday, 18 January 2012 09:00 Written by TradersHuddle Staff

New York, January 18th (TradersHuddle.com) - Shares of Adobe Systems Incorporated (NASDAQ:ADBE) closed the trading session at $29.35 near its 50 day and 200 day moving averages currently set at $28.01 and $29.03 respectively. Adobe's price action is above these important levels, which could translate into a trading opportunity.

Adobe Systems Incorporated (NASDAQ:ADBE) develops, markets, and supports computer software products and technologies. The Company's products allow users to present and use information across all print and electronic media. Adobe offers a line of application software products, type products, and content for creating, distributing, and managing information. The company popular Acrobat Reader allows companies and consumers to exchange a wide variety of electronic information and documents.

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 $27.40 and calculated resistance at $29.47. 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 Adobe, 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.