Is This Tech Stock Ready To Make A Move?
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Fastly, Inc. provides real-time content delivery network services. It offers edge computing, edge delivery, edge security, edge applications like load balancing and image optimization, video on demand, and managed edge delivery.
Take a look at the 1-year chart of Edge (FSLY) below with the added notations:
FSLY has been declining for most of the past year and is now consolidating within a common chart pattern known as a symmetrical triangle, or pennant. A down trending resistance combined with an up-trending support forms the pattern (blue). Since there is no way to know which way the stock will break, some traders may wait for the breakout or breakdown before entering a trade.
The Tale of the Tape: FSLY has formed a consolidation pattern. A short trade could be made on a break of support or on a test of resistance. A long trade could be made at support or on a break through the triangle resistance.
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
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