Is Intrepid Potash Waiting for a Break Out?

Published on Friday, 20 April 2012 08:44 Written by TradersHuddle Wire

New York, April 20th (TradersHuddle.com) - Intrepid Potash, Inc. (NYSE:IPI) ended the trading session at $23.37, near its 50 day moving average set at $24.30. Intrepid Potash's price action placed the stock below this important level, which makes it difficult to be bought, as the stock will certainly face resistance as it approaches its 50 day moving average.

Intrepid Potash, Inc. (NYSE:IPI) mines and markets potash for use as a fertilizer. It also offers by-products, including salt, magnesium chloride, and metal recovery salts. Intrepid serves agricultural, industrial, and feed markets. The company is based in Denver, Colorado.

The latest price action range, defined by a peaks and troughs algorithm, placed calculated support at $22.10 and resistance at $23.55. These levels will be closely monitored, as they provide great insight into the latest price dynamics.

If traders want to establish a position in Intrepid Potash, given the resistance expected as the stock approaches its 50 day moving average, a trade might materialize as the stock manages to break this important technical level. After the breakout, the 50 day moving average could be used as support going forward. However, until the break materializes, buying the stock is basically a gamble with 50-50 chance.