Is eBay Breaking Out?

Published on Friday, 03 September 2010 04:44 Written by Danny Miller

New York, September 3rd (TradersHuddle.com) - Shares of eBay Inc. (NASDAQ:EBAY) closed the trading session at $24.06 just above calculated resistance at $23.51 moving to what appears to be a new range, as this move will clearly raise the attention of momentum buyers.

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 stock was trading in a well defined range with support at $22.37 and resistance at $23.51, 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 resistance becomes support, as the new range gets defined, however, given that eBay's stock is still near the broken resistance level, traders will be focusing on $23.51 to see if the stock holds the breakout without rolling over.