Fortinet Inc (NASDAQ: FTNT)

Fortinet, Inc. provides cyber security solutions for enterprises, service providers, and government organizations worldwide. The company offers FortiGate physical and virtual appliances products that provide various security and networking functions, including firewall, intrusion prevention, anti-malware, virtual private network, application control, Web filtering, anti-spam, and wide area network acceleration; FortiManager product family to provide a central management solution for FortiGate products comprising software updates, configuration, policy settings, and security updates; and the FortiAnalyzer product family, which provides a single point of network log data collection.

Take a look at the 1-year chart of Fortinet (NASDAQ: FTNT) below with my added notations:

1-year chart of Fortinet (NASDAQ: FTNT)

FTNT is been trending lower for the past 8 months, but most recently the stock has created a key level of resistance to watch at $30 (red). FTNT has already tested that level a couple of times since the beginning of the year, and that level was also support back in December. A break above that $30 level should lead to higher prices for the stock.

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The Tale of the Tape: FTNT has a key level of resistance at $30. A long trade could be entered on a break through that level. However, if you are bearish on the stock, a short trade could be made on any rallies up to $30.

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!

Good luck!

Christian Tharp, CMT

Follow me on Twitter: @cmtstockcoach