Shares of Sunrise Senior Living, Inc (NYSE: SRZ), the McLean, Va-based companny which develops and maintains senior living residences and other facilities is showing a warning sign that it’s ready to take a breather.
The stock has retraced from its recent high price of $8.38 that occurred on February 17, 2012. It broke the 200DMA yesterday (March 28, 2012) on high volume, indicative of distribution. The closest support around $7.16 was broken yesterday. The next closest support is around the $5.97 area; if that’s taken out, then $5.50 would be next support. A retracement trade could trigger around $5.97, in which case the target would be around $7.16. A close above the $7.16, which is above the 200DMA, could trigger a breakout signal. Confirmation would occur when the low of the day would be above $7.16.
The general market is also consolidating at these levels. The SPX (S&P500 index) has been consolidating between 1389 and 1419 for over a week. A close above 1420 could trigger a breakout entry in the markets for a target around the 1440 area. The current consolidation in the markets should be construed as healthy as long as the support at the 20DMA does not breakdown.