Pulte Waiting for a Break Out?

Published on Tuesday, 31 August 2010 07:04 Written by Christopher Lynn

New York, August 31st (TradersHuddle.com) - Shares of Pulte Homes, Inc. (NYSE:PHM) closed the trading session at $8.05 near its 50 day moving average currently set at $8.44. Pulte's price action is below this important level, which makes the stock difficult to buy, as there will certainly be resistance as it approaches its 50 day.

Pulte Homes, Inc. (NYSE:PHM) constructs and develop residential and active adult communities. The Company also provides mortgage financing, title insurance, and other services to home buyers. Pulte has operations in various markets across the United States and Puerto Rico.

Latest price action range, defined by a peaks and troughs algorithm places calculated support at $7.70 and calculated resistance at $8.50. These levels will be closely watched by traders, as they provide great insight into the latest price dynamics defined by Pulte shares.

Traders should evaluate their trade if they want to establish a position on Pulte given the resistance expected as the stock approaches the 50 day moving average. A trade might materialize as the stock manages to break this important level, as it could be used as support going forward, however until the break materializes buying the stock is nothing different than flipping a coin. Other levels that traders will be evaluating are the ones defined by the peak and troughs algorithm that provides great price level reference points.