Trading Idea - Is Cummins close to Support?

Published on Wednesday, 01 September 2010 05:12 Written by Christian Paolinetti

New York, September 1st (TradersHuddle.com) - Shares of Cummins Inc. (NYSE:CMI) are trading very close to calculated support at $71.51 with current price action closing at just $74.41 places the stock price near levels where traders will start paying attention.

Cummins Inc. designs, manufactures, distributes and services diesel and natural gas engines. The Company also manufactures electric power generation systems and engine-related component products, including filtration and exhaust aftertreatment, fuel systems, controls, and air handling systems. The Cummins, Inc. headquartered in Columbus, Indiana.

Cummins' current stock range is defined by current calculated support defined at $71.51 and by the resistance level at $76.50, which should be used by traders planning their trades.

Traders wanting to establish a position should place close attention to Cummins' price action, and establish a position as close to support as possible, but only after buying materializes. Traders should understand that the resistance point at $76.50 might limit their upside, however if the stock breaks resistance, it could be a good point to add to the position.