IBM Close to Probable Support

Published on Thursday, 29 July 2010 06:32 Written by Christian Paolinetti

New York, July 29th (TradersHuddle.com) - Shares of International Business Machines Corp. (NYSE:IBM) closed the trading session at $128.63 near its 50 day and 200 day moving averages currently set at $127.2364 and $127.3266 respectively. IBM's price action is 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 action is above important moving averages, it's important to highlight that the 50 day moving average is currently below the 200 day moving average resulting in not a prime setup where buying the dip will present a good trading opportunity.

Looking at peaks and troughs horizontal support and resistance levels, we can see current calculated support at $122.93 and calculated resistance at $131.6. These levels should also be evaluated by traders when planning their trades, as they provide an insight into the latest price action.

If traders want to establish a position on IBM, should evaluate their trade, as 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 see where the current price action of stock is and establish a short trade versus those levels.