Fortinet, Inc. provides broad, automated, and integrated cybersecurity solutions worldwide. The company sells its security solutions to channel partners; and directly to end-customers, including small and medium-sized businesses, large enterprises, and government organizations in a range of industries consisting of telecommunications, technology, government, financial services, education, retail, manufacturing, and healthcare.
Take a look at the 1-year chart of Fortinet (NASDAQ: FTNT) below with my added notations:
During the most recent two months, FTNT has created a clear level of support at $65 (green). In addition, thanks to yesterday’s rally, the stock may be running into a trendline of resistance (red). At some point, one of those two lines will have to break.
The Tale of the Tape: FTNT has a $65 support and trendline resistance to monitor. A long position could be entered on a pullback to the $65 level, or on a break of resistance, with a stop placed under the level of entry. A break of the $65 should setup a potential bearish play 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