Costco near Resistance

Published on Friday, 10 February 2012 08:48 Written by TradersHuddle Wire

New York, February 10th (TradersHuddle.com) - Shares of Costco Wholesale Corporation (NASDAQ:COST) are trading very close to calculated resistance at $86.18 with the current price action closing at just $84.53 placing the stock near levels that make it difficult to buy.

Costco Wholesale Corporation (NASDAQ:COST) operates wholesale membership warehouses in multiple countries. The Washington State based company sells all kinds of food, automotive supplies, toys, hardware, sporting goods, jewelry, electronics, apparel, health and beauty aids, as well as other goods.

Costco's current stock range is defined by current calculated support defined at $78.81 and by the resistance level at $86.18, 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 Costco, as the stock is well above support, however, as the stock pulls back towards $78.81 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 $86.18 then traders will get an opportunity to enter Costco stock by establishing a position as the stock moves to a higher range.