ETP Broke Support

Published on Monday, 21 May 2012 08:24 Written by TradersHuddle Wire

New York, May 21st (TradersHuddle.com) - Shares of Energy Transfer Partners, L.P. (NYSE:ETP) closed the trading session at $44.06 below calculated support at $45.85. The stock broke long setups, prompting the bulls to worry that this move might give the bears the upper hand.

Energy Transfer Partners, L.P. (NYSE:ETP) is a publicly traded partnership owning and operating a diversified portfolio of energy assets. ETP has pipeline operations in Arizona, Colorado, Louisiana, New Mexico, and Utah, and owns the largest intrastate pipeline system in Texas. The company currently has natural gas operations that include gathering and transportation pipelines, treating and processing assets, and three storage facilities located in Texas. And its one of the three largest retail marketers of propane in the U.S.

ETP's stock was trading in a well defined range with support at $45.85 and resistance at $51; given that this range was broken traders will be closely monitoring the stock's price action for clues of direction.

From a technical perspective, it can be expected that previous support becomes resistance, as the new range gets defined. However, $45.85 will remain in focus as ETP's price action places the stock near the broken support. Traders will be waiting to see if it can bounce back and return to its previous range.

Traders wanting to establish a short position in ETP can do so if the stock breaks the intraday low, or if the stock bounces back and selling materializes again at previous support of $45.85. However, if traders want to build a long position, the best entry point to do so is when the price action takes the stock back to calculated support.