Behemoths Fatiguing:

  • The XLY on a YTD basis continues to lag besting just the communication services group lower by 24%, the 10th "strongest" actor out of 11. The top-heavy ETF is adversely affected by its two largest components, both of which recorded stock splits in the last few months and we know stocks tend to lag after these. TSLA flirted with breaking above a bull flag pivot of 315 (split adjusted) but was never able to break above it and it is now 34% off highs made last November near the very round 400 number. The chart below of AMZN has now given back more than half of the impressive 4 weeks winning streak the weeks ending between 7/22-8/12 that rose by a combined 24% the last 3 weeks. This name is also one-third off its annual highs and if one is playing this name on the long side using a stop of 123 as always on a CLOSING basis. The XLY is now lower 10 of last 14 sessions and give Tuesday some credit for holding last Thursday's low, but below that level, all bets are off.

Clearing Complexion:

  • We always like to highlight names that have shown resilience during a very weak recent period in the markets overall. The chart below of ULTA could be a good example. Within the "vanity" space there has been some bifurcation with ELF acting very well just 3% off most recent 52-week highs nearly doubling from the very round 20 number in late May. Incredibly it has advanced 12 of the last 15 weeks. On the other hand names like COTY and EL are both 34% off their annual peaks. The latter is still making higher lows since late May and must remain above 238.52 to remain in good standing of that. ULTA is just 3% off most recent 52-week highs compared to the XLY that is 28% off heights made and is looking for a 5-week winning streak depending on Fridays CLOSE this week. The stock is attempting to break above the highs of the bullish engulfing WEEKLY candle the week ending 5/27 that jumped an incredible 24% in double average WEEKLY volume.

Recent Examples:

  • Over the last one-week period, the casual diners space has been a positive one. WING which doubled from late May to mid-August recorded a bullish piercing line candle after a prudent pullback after that robust run. PLAY continues to act well and has a bull flag which has found support at the round 40 number and a move above 44 carries a measured move to 58. MCD continues to find support at its 200-day SMA but has the look of a possible bearish head and shoulders pattern that started on 7/1 if the right clavicle is shaping up here. Below is the chart of WEN and how it appeared in our 8/19 Consumer Note. It has been the source of takeover speculation and we thought a break above a bull flag pivot of 21.50 made sense, but PRICE never confirmed the entry, and anyone who tried to "front run" the idea is now off to the tune of more than 10%. 

Special Situations:

  • Discount retail play lower by 2% YTD and up 49% over last one year period.
  • Name 22% off most recent 52-week highs and fell 1.5% last week after the prior week slumped 17.3%. Big volume last couple weeks as week ending 8/26 was accompanied by largest WEEKLY volume in 10 months.
  • Earnings mostly higher up 21.9, .1, and 9.2% on 5/26, 3/2, and 11/23/21 before a recent loss of 10.2% on 8/25.
  • Enter after recent gap fill.
  • Entry DLTR here.  Stop 134.

  • Lodging play down 8% YTD and up 14% over last one-year period. Dividend yield of .8%.
  • Name 22% off most recent 52-week highs and up just 6 weeks since gravestone doji candle week ending 4/22. Slight relative strength last week down 1.6% as XLY fell 2.5%.
  • Earnings mostly higher with gains of 4.7, 5.8, and 2.8% on 5/4, 2/15, and 11/3/21 before recent loss of .8% on 8/2.
  • Enter on pullback into bullish hammer/very round number.
  • Entry MAR here.  Stop 148.

  • Gaming play down 41% YTD and 62% over last one-year period.
  • Name 64% off most recent 52-week highs and down 4 of last 5 weeks. Round 30 number on WEEKLY CLOSING basis important as since week ending 5/13, eight weeks were below 30 intraweek but 7 CLOSED above it.
  • FOUR straight negative earnings reactions off 4, 5.6, .8, and 21.1% on 8/4, 5/5, 2/3, and 11/4/21.
  • Enter on pullback into symmetrical breakout/round number.
  • Entry PENN here.  Stop 28.25.

Good luck.

Entry summaries:

Buy after recent gap fill DLTR here.  Stop 134.

Buy pullback into bullish hammer/very round number MAR here.  Stop 148.

Buy pullback into symmetrical breakout/round number PENN here.  Stop 28.25.

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Behemoths Fatiguing:

  • The XLY on a YTD basis continues to lag besting just the communication services group lower by 24%, the 10th "strongest" actor out of 11. The top-heavy ETF is adversely affected by its two largest components, both of which recorded stock splits in the last few months and we know stocks tend to lag after these. TSLA flirted with breaking above a bull flag pivot of 315 (split adjusted) but was never able to break above it and it is now 34% off highs made last November near the very round 400 number. The chart below of AMZN has now given back more than half of the impressive 4 weeks winning streak the weeks ending between 7/22-8/12 that rose by a combined 24% the last 3 weeks. This name is also one-third off its annual highs and if one is playing this name on the long side using a stop of 123 as always on a CLOSING basis. The XLY is now lower 10 of last 14 sessions and give Tuesday some credit for holding last Thursday's low, but below that level, all bets are off.

Clearing Complexion:

  • We always like to highlight names that have shown resilience during a very weak recent period in the markets overall. The chart below of ULTA could be a good example. Within the "vanity" space there has been some bifurcation with ELF acting very well just 3% off most recent 52-week highs nearly doubling from the very round 20 number in late May. Incredibly it has advanced 12 of the last 15 weeks. On the other hand names like COTY and EL are both 34% off their annual peaks. The latter is still making higher lows since late May and must remain above 238.52 to remain in good standing of that. ULTA is just 3% off most recent 52-week highs compared to the XLY that is 28% off heights made and is looking for a 5-week winning streak depending on Fridays CLOSE this week. The stock is attempting to break above the highs of the bullish engulfing WEEKLY candle the week ending 5/27 that jumped an incredible 24% in double average WEEKLY volume.

Recent Examples:

  • Over the last one-week period, the casual diners space has been a positive one. WING which doubled from late May to mid-August recorded a bullish piercing line candle after a prudent pullback after that robust run. PLAY continues to act well and has a bull flag which has found support at the round 40 number and a move above 44 carries a measured move to 58. MCD continues to find support at its 200-day SMA but has the look of a possible bearish head and shoulders pattern that started on 7/1 if the right clavicle is shaping up here. Below is the chart of WEN and how it appeared in our 8/19 Consumer Note. It has been the source of takeover speculation and we thought a break above a bull flag pivot of 21.50 made sense, but PRICE never confirmed the entry, and anyone who tried to "front run" the idea is now off to the tune of more than 10%. 

Special Situations:

  • Discount retail play lower by 2% YTD and up 49% over last one year period.
  • Name 22% off most recent 52-week highs and fell 1.5% last week after the prior week slumped 17.3%. Big volume last couple weeks as week ending 8/26 was accompanied by largest WEEKLY volume in 10 months.
  • Earnings mostly higher up 21.9, .1, and 9.2% on 5/26, 3/2, and 11/23/21 before a recent loss of 10.2% on 8/25.
  • Enter after recent gap fill.
  • Entry DLTR here.  Stop 134.

  • Lodging play down 8% YTD and up 14% over last one-year period. Dividend yield of .8%.
  • Name 22% off most recent 52-week highs and up just 6 weeks since gravestone doji candle week ending 4/22. Slight relative strength last week down 1.6% as XLY fell 2.5%.
  • Earnings mostly higher with gains of 4.7, 5.8, and 2.8% on 5/4, 2/15, and 11/3/21 before recent loss of .8% on 8/2.
  • Enter on pullback into bullish hammer/very round number.
  • Entry MAR here.  Stop 148.

  • Gaming play down 41% YTD and 62% over last one-year period.
  • Name 64% off most recent 52-week highs and down 4 of last 5 weeks. Round 30 number on WEEKLY CLOSING basis important as since week ending 5/13, eight weeks were below 30 intraweek but 7 CLOSED above it.
  • FOUR straight negative earnings reactions off 4, 5.6, .8, and 21.1% on 8/4, 5/5, 2/3, and 11/4/21.
  • Enter on pullback into symmetrical breakout/round number.
  • Entry PENN here.  Stop 28.25.

Good luck.

Entry summaries:

Buy after recent gap fill DLTR here.  Stop 134.

Buy pullback into bullish hammer/very round number MAR here.  Stop 148.

Buy pullback into symmetrical breakout/round number PENN here.  Stop 28.25.