Lennar Is Dipping Below Support
Published on Friday, 22 February 2013 08:20 Written by TradersHuddle Wire
New York, February 22nd (TradersHuddle.com) - Shares of Lennar Corporation (NYSE:LEN) closed the trading session at $37.69 below calculated support at $39.21. The stock broke long setups, prompting the bulls to worry that this move might give the bears the upper hand.
Lennar Corporation (NYSE:LEN) builder of single-family attached and detached homes. The Company also provides mortgage financing, title insurance, closing services and other ancillary services.
Lennar's stock was trading in a well defined range with support at $39.21 and resistance at $41.55; 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, $39.21 will remain in focus as Lennar'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 Lennar can do so if the stock breaks the intraday low, or if the stock bounces back and selling materializes again at previous support of $39.21. 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.