For today's chart we've chosen to take a look at Under Armour Inc. (NYSE:UA) because it is testing an interesting level of resistance. As you can see from the chart below, the $44 mark has proven to be very influential and we believe that technical traders will continue to watch this level to see if it can prevent the bulls from sending the price higher. This chart is a good example of how a certain price level can change its role from support into resistance.
As many of you know, it is not uncommon to see a previous level that has prevented a move lower to change its role and become a new area of resistance once the price breaks down. Technical traders will consider entering a short position near $44 because the nearby horizontal trendline offers an interesting risk/reward ratio.
For more, see Support and Resistance Reversals