Starbucks near Key Resistance Area

Published on Tuesday, 07 February 2012 09:28 Written by TradersHuddle Wire

New York, February 7th (TradersHuddle.com) - Shares of Starbucks Corporation (NASDAQ:SBUX) are trading very close to calculated resistance at $48.39 with the current price action closing at just $48.29 placing the stock near levels that make it difficult to buy.

Starbucks Corporation (NASDAQ:SBUX) retails, roasts, and provides its own brand of specialty coffee. The Company operates retail locations worldwide and sells whole bean coffees through several distribution channels. Starbucks also produces and sells bottled coffee drinks.

Starbucks' current stock range is defined by current calculated support defined at $42.67 and by the resistance level at $48.39, 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 Starbucks, as the stock is well above support, however, as the stock pulls back towards $42.67 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 $48.39 then traders will get an opportunity to enter Starbucks stock by establishing a position as the stock moves to a higher range.