Taking Different Routes:

  • The top two holdings in the XLY veered off in different directions on Friday. The end of the week displayed some interesting action within the top-heavy retail ETF. AMZN and TSLA are the only double-digit percentage components in the fund and the former recorded an ugly intraday reversal with a bearish engulfing candle on Friday. It CLOSED nearly 90 handles, off highs for the session. This is a rather myopic look, but the chart below of TSLA refused to give any ground and CLOSED near highs for the daily range on a depressing tape. Notice it was another higher low and a bullish engulfing candle that CLOSED above both its 50 day SMA and a prior break above a bullish ascending triangle pivot of 700. The last time it went on a powerful price run following a bullish engulfing candle at the round 600 number on 3/30. Make no mistake about it AMZN is the better acting stock at the moment, just 2% off all-time highs. TSLA is still in bear market mode off 21% from a peak made in late January. With TSLA however, you now have a clearer stop to play against, the devilish 666 figure, Friday's intraday low.

Pool Party:

  • The home improvement plays have been on a surge recently. Two of the biggest names in the space in HD and LOW, are diverging slightly with HD now just 2% off its most recent 52-week highs while LOW is now 6% off its own recent peak (HD recorded a 6-week winning streak between weeks ending 3/12-4/16 that ran higher by nearly 80 handles top to bottom). FND ended a 7-week winning streak of its own this week. RH is now fading a bit from the round 700 number, where it broke above a bull flag. Looking at a couple of other names in the arena below in POOL and LESL, show the 2 major players in the pool space (unless AMZN looks to get involved, of course, that is a stab at humor). Below is the chart of LESL, a recent new issue that does REPORT earnings on 5/5 after the close next week. It received an indirect boost when POOL reported numbers on 4/22 jumping more than 6%. LESL rose more than 4% that day, and it will have proving to do on its own merit next Wednesday. Friday snapped a 7 session winning streak, losing more than 4%. Cannon Ball anyone? 

Recent Examples:

  • As much as many detest the incessant "reopening" phrase, it is a good reminder to stick with things that are working. Remember trends tend to persist, more likely than they are to reverse. The cruise lines have been acting well, and I will have my eyes on NCLH as it fights to stay above the round 30 number within a symmetrical triangle. SEAS is breaking above a long bull flag, and even RICK is behaving itself as it carves out a bullish ascending triangle. Not sure how their establishments have been open in the last year! NDLS broke powerfully above a double bottom pivot of 10.90 on Thursday and Friday followed through robustly on a soft tape. Airlines have been a solid group, and below is the chart of UAL, and how it appeared in our 4/23 Consumer Sector Note. It has acted well since putting in a bullish piercing line candle at the very round 50 number on 4/21. The stock is now flirting with recouping its 50 day SMA, and IF that occurs it puts the add-on double bottom pivot of 61.44 in focus. Fasten your seat belts, the flight may be ready for take-off, pun intended.

Special Situations:

  • Retail play higher by 28% YTD and 80% over last one year period.
  • Just 2% off most recent 52-week highs, and advanced 19 of last 26 weeks. Solid volume trends as well with last week of distribution the week ending 10/30/20.
  • Three straight negative earnings reactions off 5, 4.4, and .6% on 10/29, 8/4, and 5/27/20 (rose 2.5% on 2/4).
  • Enter on pullback into ascending triangle breakout.
  • Entry RL 131.  Stop 125.

  • Canadian retail play higher by 44% YTD and 72% over last one year period.
  • No back to back WEEKLY gains since January. Five weeks ending between 3/26-4/23 all were below 40 intraweek, but all of them CLOSED above 40. Good wall of support there.
  • Earnings mostly higher with gains of 22, .4, and 17.7% on 2/4, 11/5, and 6/3/20 (fell 5.2% on 8/11/20).
  • Enter with buy stop above double-bottom base.
  • Entry GOOS 43.06.  Stop 41.

  • German auto play higher by 50% YTD and lower by 12% from most recent 52 week highs. Dividend yield of 2.5%.
  • Name has doubled since October lows, and this week recorded first back-to-back WEEKLY losses since first 2 weeks of 2021. Prior consecutive WEEKLY declines were last September to show how strong momentum has been.
  • Earnings mixed with smaller gains of 2.4 and 2% on 11/10 and 8/10/20, and drops of 10.7 and 6.8% on 3/23 and 5/12/20.
  • Buy pullback into very round number.
  • Entry POAHY 10.35.  Stop 9.70.

Good luck.

Entry summaries:

Buy pullback into ascending triangle breakout RL 131.  Stop 125.

Buy stop above double bottom pivot GOOS 43.06.  Stop 41.

Buy pullback into very round number POAHY 10.35.  Stop 9.70.

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Taking Different Routes:

  • The top two holdings in the XLY veered off in different directions on Friday. The end of the week displayed some interesting action within the top-heavy retail ETF. AMZN and TSLA are the only double-digit percentage components in the fund and the former recorded an ugly intraday reversal with a bearish engulfing candle on Friday. It CLOSED nearly 90 handles, off highs for the session. This is a rather myopic look, but the chart below of TSLA refused to give any ground and CLOSED near highs for the daily range on a depressing tape. Notice it was another higher low and a bullish engulfing candle that CLOSED above both its 50 day SMA and a prior break above a bullish ascending triangle pivot of 700. The last time it went on a powerful price run following a bullish engulfing candle at the round 600 number on 3/30. Make no mistake about it AMZN is the better acting stock at the moment, just 2% off all-time highs. TSLA is still in bear market mode off 21% from a peak made in late January. With TSLA however, you now have a clearer stop to play against, the devilish 666 figure, Friday's intraday low.

Pool Party:

  • The home improvement plays have been on a surge recently. Two of the biggest names in the space in HD and LOW, are diverging slightly with HD now just 2% off its most recent 52-week highs while LOW is now 6% off its own recent peak (HD recorded a 6-week winning streak between weeks ending 3/12-4/16 that ran higher by nearly 80 handles top to bottom). FND ended a 7-week winning streak of its own this week. RH is now fading a bit from the round 700 number, where it broke above a bull flag. Looking at a couple of other names in the arena below in POOL and LESL, show the 2 major players in the pool space (unless AMZN looks to get involved, of course, that is a stab at humor). Below is the chart of LESL, a recent new issue that does REPORT earnings on 5/5 after the close next week. It received an indirect boost when POOL reported numbers on 4/22 jumping more than 6%. LESL rose more than 4% that day, and it will have proving to do on its own merit next Wednesday. Friday snapped a 7 session winning streak, losing more than 4%. Cannon Ball anyone? 

Recent Examples:

  • As much as many detest the incessant "reopening" phrase, it is a good reminder to stick with things that are working. Remember trends tend to persist, more likely than they are to reverse. The cruise lines have been acting well, and I will have my eyes on NCLH as it fights to stay above the round 30 number within a symmetrical triangle. SEAS is breaking above a long bull flag, and even RICK is behaving itself as it carves out a bullish ascending triangle. Not sure how their establishments have been open in the last year! NDLS broke powerfully above a double bottom pivot of 10.90 on Thursday and Friday followed through robustly on a soft tape. Airlines have been a solid group, and below is the chart of UAL, and how it appeared in our 4/23 Consumer Sector Note. It has acted well since putting in a bullish piercing line candle at the very round 50 number on 4/21. The stock is now flirting with recouping its 50 day SMA, and IF that occurs it puts the add-on double bottom pivot of 61.44 in focus. Fasten your seat belts, the flight may be ready for take-off, pun intended.

Special Situations:

  • Retail play higher by 28% YTD and 80% over last one year period.
  • Just 2% off most recent 52-week highs, and advanced 19 of last 26 weeks. Solid volume trends as well with last week of distribution the week ending 10/30/20.
  • Three straight negative earnings reactions off 5, 4.4, and .6% on 10/29, 8/4, and 5/27/20 (rose 2.5% on 2/4).
  • Enter on pullback into ascending triangle breakout.
  • Entry RL 131.  Stop 125.

  • Canadian retail play higher by 44% YTD and 72% over last one year period.
  • No back to back WEEKLY gains since January. Five weeks ending between 3/26-4/23 all were below 40 intraweek, but all of them CLOSED above 40. Good wall of support there.
  • Earnings mostly higher with gains of 22, .4, and 17.7% on 2/4, 11/5, and 6/3/20 (fell 5.2% on 8/11/20).
  • Enter with buy stop above double-bottom base.
  • Entry GOOS 43.06.  Stop 41.

  • German auto play higher by 50% YTD and lower by 12% from most recent 52 week highs. Dividend yield of 2.5%.
  • Name has doubled since October lows, and this week recorded first back-to-back WEEKLY losses since first 2 weeks of 2021. Prior consecutive WEEKLY declines were last September to show how strong momentum has been.
  • Earnings mixed with smaller gains of 2.4 and 2% on 11/10 and 8/10/20, and drops of 10.7 and 6.8% on 3/23 and 5/12/20.
  • Buy pullback into very round number.
  • Entry POAHY 10.35.  Stop 9.70.

Good luck.

Entry summaries:

Buy pullback into ascending triangle breakout RL 131.  Stop 125.

Buy stop above double bottom pivot GOOS 43.06.  Stop 41.

Buy pullback into very round number POAHY 10.35.  Stop 9.70.