The 200 Day Moving Average is Key for Brocade
Published on Friday, 28 December 2012 07:36 Written by TradersHuddle Wire
New York, December 28th (TradersHuddle.com) - Brocade Communications Systems, Inc. (NASDAQ:BRCD) closed the trading session at $5.22, near its 200 day moving average set at $5.39. Brocade's stock action is below this level, which makes the stock difficult to be bought, as it will face resistance as it approaches its 200 day moving average.
Brocade Communications Systems, Inc. (NASDAQ:BRCD) provides switching solutions for storage area networks. Its family of SilkWorm switches enables a company to manage growth of its data storage requirements, improve the data transfer performance, and increase the size of its storage area networks.
Latest price action range, defined by a peaks and troughs algorithm, placed calculated support at $5.26 and resistance at $5.60. Traders should closely monitor these levels, as they provide great reference points for the latest price action in Brocade.
If traders want to establish a position on Brocade, given that resistance could materialize as the stock approaches its 200 day moving average, a trade might materialize as the stock manages to break this important level. After the breakout, the 200 day moving average could be used as support going forward. However, until the break materializes, traders need to exercise patience.