Anheuser-Busch InBev SA/NV, a brewing company, engages in the production, distribution, and sale of beer, alcoholic beverages, and soft drinks worldwide. It offers a portfolio of approximately 500 beer brands, including Budweiser, Corona, and Stella Artois; Becks, Castle, Castle Lite, Hoegaarden, and Leffe; and Aguila, Antarctica, Bud Light, Brahma, Cass, Chernigivske, Cristal, Harbin, Jupiler, Klinskoye, Michelob Ultra, Modelo Especial, Quilmes, Victoria, Sedrin, Sibirskaya Korona, and Skol brands.
Take a look at the 1-year chart of Anheuser (NYSE: BUD) below with the added notations:
BUD got hit pretty hard last October and November. Since then, the stock has been trending steadily higher. Once BUD stalled in May, the stock has ended up finding both support and resistance at the key level of $115. A break above $115 would most likely lead to higher prices.
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The Tale of the Tape: BUD has a key level at $115. Traders could enter a long position on a break above $115, with a stop placed below that level. Traders that are bearish on the stock may want to enter a short position on a test of that level instead.
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