New York, December 27th (TradersHuddle.com) - Shares of Altria Group, Inc. (NYSE:MO) closed the trading session at $31.32 below calculated support at $31.40. The stock broke down technically, raising concerns as the move might trigger additional selling.
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.
Altria's stock was trading in a well defined range with support at $31.40 and resistance at $33.97; given that this range was broken traders will be closely monitoring the stock's price action for clues of direction.
From a technical perspective, it can be expected that previous support becomes resistance, as the new range gets defined. However, $31.40 will remain in focus as Altria's price action places the stock near the broken support. Traders will be waiting to see if it can bounce back and return to its previous range.
Traders wanting to establish a short position in Altria can do so if the stock breaks the intraday low, or if the stock bounces back and selling materializes again at previous support of $31.40. However, if traders want to build a long position, the best entry point to do so is when the price action takes the stock back to calculated support.