eBay near Key Resistance Area

Published on Wednesday, 25 August 2010 04:16 Written by Danny Miller

New York, August 25th (TradersHuddle.com) - Shares of eBay Inc. (NASDAQ:EBAY) are trading very close to calculated resistance at $23.61 with the current price action closing at just $22.87 placing the stock near levels that make it difficult to buy.

eBay Inc. (NASDAQ:EBAY) operates an online auction community. The service is used to buy and sell products and services such as coins, collectibles, computers, memorabilia, stamps and toys, and sporting tickets. eBay also offers, through its subsidiary PayPal, secure online payment services.

eBay's current stock range is defined by current calculated support defined at $19.92 and by the resistance level at $23.61, the stock is clearly over-extended from support, making it difficult to establishing new long positions at this level.

Traders don't have a clear entry point for eBay, as the stock is well above support, however, as the stock pulls back towards $19.92 it will definitely provide a reference point to establish a trade. On the other hand if the stock decides to break above resistance level at $23.61 then traders will get an opportunity to enter eBay stock by establishing a position as the stock moves to a higher range.