IBM Is Near to the 50 and 200 Day Moving Averages

Published on Friday, 03 August 2012 07:52 Written by TradersHuddle Wire

New York, August 3rd (TradersHuddle.com) - International Business Machines Corp. (NYSE:IBM) closed the trading day at $194.45, near its 50 day and 200 day moving averages currently set at $192.82 and $193.24 respectively. IBM's price action placed the stock above these important levels, which could translate into a trading opportunity.

International Business Machines Corporation (NYSE:IBM) provides computer solutions through the use of advanced information technology. The Company's solutions include technologies, systems, products, services, software, and financing. IBM offers its products globally through different distribution channels. Its Global Technology Services segment offers IT infrastructure and business process services. The company's Global Business Services segment provides professional services and application outsourcing services, including consulting and systems integration, and application management. IBM was founded in 1910 and is based in Armonk, NY.

Although, the price is above important moving averages, it's important to highlight that this is not a prime setup for buying the dip strategy, as the 50 day moving average is currently below the 200 day moving average.

The peaks and troughs algorithm shows calculated support at $181.85 and resistance at $197.85. These levels should also be evaluated by traders when planning their next move, as they provide an insight into the latest price action.

If traders want to establish a long position in IBM, it will certainly be better to wait, given that the stock is technically broken with the 50 day moving average trading below the 200 day moving average. Traders can also look at the current range defined by the peaks and troughs to establish a short trade versus those levels.