How to Play the Setup in Verizon
Published on Tuesday, 18 December 2012 05:48 Written by TradersHuddle Wire
New York, December 18th (TradersHuddle.com) - Verizon Communications, Inc. (NYSE:VZ) closed the trading day at $44.12, near its 50 day and 200 day moving averages set at $44.16 and $42.70 respectively. Verizon's price action placed the stock above the 200 day moving average but below its 50 day moving average, a setup that signals a possible break out.
Verizon Communications Inc. (NYSE:VZ) is an integrated telecommunications company that provides wire line voice and data services, wireless services, Internet services, and published directory information. The Company also provides network services for the federal government. Verizon is the owner of the largest wireless network, with more subscribers in the U.S. Verizon was founded in 1983 and is based in New York, New York.
Verizon seems to be setting up for a tight range between the 200 day moving average as support and the 50 day moving average serving as resistance.
A tiered approach, appears to be the best strategy to maximize possible movements in the stock, as traders could establish a small position in Verizon and wait for the stock to break out above its 50 day moving average at $44.16. Then they could add to the position as momentum builds with the breakout. On the flip side, if support being referenced at the 200 day moving average set at $42.70 breaks, it could signal further downside pressure for Verizon.