Trading the Setup In Altria

Published on Thursday, 30 August 2012 08:48 Written by TradersHuddle Wire

New York, August 30th (TradersHuddle.com) - Altria Group, Inc. (NYSE:MO) ended the trading session at $34.59, near its 50 day moving average set at $35.03. Altria'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.

Altria Group, Inc. (NYSE:MO), its a holding company, parent of Philip Morris USA, John Middleton, and US Smokeless Tobacco Company. Altria, through its subsidiaries, engages in the manufacture and sale of cigarettes, and other tobacco products in the United States and internationally. It primarily offers cigarettes under the Marlboro, Virginia Slims, and Parliament brands; smokeless tobacco products under the Copenhagen, Skoal, Red Seal, and Husky brands; and machine-made large cigars and pipe tobacco.

The latest price action range, defined by a peaks and troughs algorithm, placed calculated support at $33.02 and resistance at $36.05. These levels will be closely monitored, as they provide great insight into the latest price dynamics.

If traders want to establish a position in Altria, 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.