PolyOne Corporation provides specialized polymer materials, services and solutions in the United States and internationally. The company also provides thermoplastic elastomers, profiles and laminates, and reinforced thermoplastic composites. It sells its products through direct sales personnel, distributors, and commissioned sales agents.
Take a look at the 1-year chart of Poly (NYSE: POL) below with my added notations:
Over the past month, POL has hit the $35 resistance (red) on multiple occasions. In addition, the stock has been climbing a trend line of support (green) since the beginning of February. Together, these two lines have formed an ascending triangle on POL. Eventually, the stock will have to break either the $35 resistance or the triangle support.
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The Tale of the Tape: POL is winding up between two key levels. A long trade could be made at the triangle support or on a break above $35. A break below the trendline would be an opportunity to enter a short trade.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT
Follow me on Twitter: @cmtstockcoach