Is BP Waiting for a Break Out?

Published on Friday, 23 March 2012 08:44 Written by TradersHuddle Wire

New York, March 23rd (TradersHuddle.com) - Shares of BP plc (NYSE:BP) closed the session at $45.30 near its 50 day moving average set at $46.14. BP's price action is below this important level, which makes the stock difficult to buy, as there will certainly be resistance as it approaches its 50 day.

BP plc (NYSE:BP) is an oil and petrochemicals company. The integrated oil company explores for and produces oil and natural gas, refines, markets, and supplies petroleum products, generates solar energy, and manufactures and markets chemicals. BP was founded in 1889 and is headquartered in London, UK.

Latest price action range, defined by a peaks and troughs algorithm places support at $42.84 and calculated resistance at $48.34. These levels will be closely monitored by traders, as they provide great insight into the latest price dynamics defined by BP stock action.

Traders should evaluate their trade if they want to establish a position on BP given the resistance expected as the stock approaches the 50 day moving average. A trade might materialize as the stock manages to break this important level, as it could be used as support going forward, however, until the break materializes buying the stock is nothing different than flipping a coin. Other levels that traders will be evaluating are the ones defined by the peak and troughs algorithm that provides great price level reference points.