Is Broadcom Closing in to Resistance?

Published on Thursday, 23 August 2012 08:56 Written by TradersHuddle Wire

New York, August 23rd (TradersHuddle.com) - Shares of Broadcom Corporation (NASDAQ:BRCM) are trading very close to calculated resistance at $36.21. The stock ended the trading session at just $35.17, which is near levels that make it difficult to buy or start a position.

Broadcom Corporation (NASDAQ:BRCM) provides integrated silicon solutions that enable broadband, digital data transmission of voice, data, and video content to home and within the business enterprise. The Company designs, develops, and supplies integrated circuits for cable set-top boxes, cable modems, high-speed networking, direct satellite and digital broadcast, and digital subscriber line.

Broadcom's stock range is defined by its calculated support defined at $28.60 and by the resistance level at $36.21; the stock is clearly over-extended from support, making it harder for participants to establish fresh longs.

Traders don't have a clear entry point for Broadcom. However, as the stock pulls back towards $28.60 it will definitely provide a reference point to establish a trade. On the other hand, if the stock breaks above its resistance level at $36.21 then traders will get an opportunity to enter the stock as it moves to a higher range.