Trading Idea: What to Expect as Capital One Breaks Resistance
Published on Tuesday, 08 January 2013 07:20 Written by TradersHuddle Wire
New York, January 8th (TradersHuddle.com) - Shares of Capital One Financial Corporation (NYSE:COF) closed the session at $62.88 just above calculated resistance at $59.94. The stock effectively broke out and grasped the attention of momentum traders, which could eventually push the stock to a different trading range.
Capital One Financial Corporation (NYSE:COF) is a diversified bank. The Bank, through its subsidiaries, offers a broad spectrum of financial products and services, like credit cards and car loans to consumers, small businesses and commercial clients both domestically and internationally. Headquartered in McLean, Virginia, Capital One, N.A. has approximately 1,000 branch locations primarily in New York, New Jersey, Texas, Louisiana, Maryland, Virginia and the District of Columbia.
The stock was trading in a well defined range with support at $56.45 and resistance at $59.94. Given that this range was broken, traders will be closely monitoring Capital One's price action to gather clues on the future direction.
From a technical perspective, it can be expected that previous resistance becomes support, as the new range gets defined. However, given that Capital One is still near the broken resistance level, traders will be focusing on the $59.94 level to see if the stock holds the breakout without rolling over.