Dollar General Corp. engages in the operation of merchandise stores. Its offerings include food, snacks, health and beauty aids, cleaning supplies, basic apparel, housewares, and seasonal items. It sells brands including Clorox, Energizer, Procter & Gamble, Hanes, Coca-Cola, Mars, Unilever, Nestle, Kimberly-Clark, Kellogg’s, General Mills, and PepsiCo.
Take a look at the 1-year chart of Dollar (NYSE: DG) below with the added notations…
Chart of DG provided by TradingView
After hitting $240 as resistance (blue) on multiple occasions over the past several months, DG has now broken above that level, while also hitting a new 52-week high. Overall higher prices should be coming, but the $240 level could now provide potential support on pullbacks.
The Tale of the Tape: DG broke its 52-week resistance of $240. The possible long position on the stock would be on a pullback down to that level with a stop placed under it. A failure to hold $240 could negate the expectations for a higher move.
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
ATTENTION SUBSCRIBERS!
Do not trade options until you watch my urgent message.
Learn how to use this simple, yet extremely powerful options strategy