Stock of the day: Tractor Supply Company
30 August 2023
In today's analysis, we turn our focus to Tractor Supply Company, a stock that has seen an intriguing end to August. The stock has primarily been oscillating between two critical horizontal areas, offering traders clear levels to watch. The first area of interest is the support level around $205, denoted by a green line on the charts. The second focal point is the resistance zone at approximately $225, marked in blue.
August commenced with the stock bouncing off the resistance level and trending downwards initially. However, the tides have turned; after a meaningful bounce from the support level at $205, the stock is now on an upward trajectory, aiming for the resistance at $225.
In light of these developments, there are two primary scenarios to consider for potential trades. The first involves the stock testing the $225 resistance area. A breakout above this blue-marked zone, coupled with a breaching of the existing black downtrend line, would generate a strong buy signal. It would indicate that the stock is set for further gains and that traders could consider going long.
The alternative scenario is less optimistic. If the stock price encounters resistance at the blue-marked $225 area and the black downtrend line, then reverses course, it would be a signal to go short. This would imply that the stock might undergo a period of bearish activity, possibly retesting the $205 support level.