Five Star Stock Watch: Zynga, Inc.

The company: Zynga, Inc.

Ticker Symbol: ZNGA

Sector: Technology   

Industry: Multimedia & Graphics Software

Zynga Inc. develops, markets, and operates online social games as live services on the Internet, social networking sites, and mobile platforms in the United States and internationally. The company provides its online social games under the FarmVille, CityVille, FarmVille 2, ChefVille, CastleVille, Zynga Poker, Words With Friends, Scramble With Friends, Draw Something, Bubble Safari, Mafia Wars, Ayakashi, Horn, and Respawnables names that are available on Facebook and other social networks, and mobile platforms, as well as through Zynga.com. 

Related: Five Star Stock Watch: Google

The company was formerly known as Zynga Game Network Inc. and changed its name to Zynga Inc. in November 2010. Zynga Inc. was founded in 2007 and is headquartered in San Francisco, California. 

Related: Five Star Stock Watch: Tesla

Please take a look at the 1-year chart of Zynga below with my added notations:

Over the last year, Zynga had created a general area of resistance at $4. Earlier in November the stock finally pushed above that $4 resistance and shot higher as traders would expect. The increase in volume adds validity to the breakout. Long entries could be considered on pullbacks back down to the previous $4 level.

With the overall market being quite overextended, a pullback could come sooner, rather than later. A break back below $4 would negate the forecast for a move higher.

Related: Five Star Stock Watch: Facebook

Zynga isn't set to release earnings again until February, 2014.

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!