Trading Idea - Is Textron close to Resistance?

Published on Friday, 30 July 2010 06:04 Written by TradersHuddle Staff

New York, July 30th (TradersHuddle.com) - Shares of Textron Inc. (NYSE:TXT) are trading very close to calculated resistance at $21.40 with the current price action closing at just $20.69 placing the stock near levels that make it difficult to buy.

Textron Inc. (NYSE:TXT) is a global, multi-industry company with operations in aircraft, defense, industrial products, and finance. Its products include airplanes, helicopters, weapons, and automotive products. The finance division offers asset based lending, aviation, distribution, golf, and resort finance.

Textron's current stock range is defined by current calculated support defined at $17.10 and by the resistance level at $21.40, the stock is clearly over-extended from support, making it difficult to establishing new long positions at this level.

Traders don't have a clear entry point for Textron, as the stock is well above support, however, as the stock pulls back towards $17.10 it will definitely provide a reference point to establish a trade. On the other hand if the stock decides to break above resistance level at $21.40 then traders will get an opportunity to enter Textron stock by establishing a position as the stock moves to a higher range.