Traders Should Expect This Stock to Take Another Leg Higher

Northrop Grumman Corp. (NOC) engages in the provision of security businesses. It includes products, systems, and solutions in autonomous systems, cyber, command, control, communications and computers, intelligence, surveillance and reconnaissance, strike, and logistics and modernization. It operates through the following business segments: Aerospace Systems, Mission Systems, and Technology Services.

Take a look at the 1-year chart of Northrop Grumman Corp. below with added notations:

NOC had been mostly in a sideways range over the past several months, while also stalling in the $380 area (green) a few times.

That level was NOC’s 52-week high resistance barrier, and now that the stock has broken above it, traders should be able to expect it to take another leg higher.

The Tale of the Tape: NOC broke its 52-week resistance at $380.

The ideal long position on the stock would be on a pullback down to that level with a stop placed under it.

A break back below $380 could negate the forecast for a move higher.

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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Source: Today’s Big Stock