Start Your Engines:

  • The most talked about automobile name on the planet is shifting into overdrive. TSLA rose more than 9% last week, the second time it has done that in the last 3, and it has now nearly doubled in PRICE since the late April lows. That week recorded a bullish piercing line candle and round number theory played a role with a bullish hammer candle off the very round par number the week ending 1/6/23, and the top was a bearish engulfing candle at 300 the week ending 7/21/23. It now looks back in gear as last week inched above a 260 bullish inverse head and shoulders pivot. The MONTHLY chart shows the importance of candles at critical highs and lows with a doji candle in November 2021 which started the symmetrical triangle we now see. A break above here in October would carry a measured move to nearly 600, which could take 2-3 years but for long-term holders, an appetizing target. On the daily chart, one has to admire the tight trade and relatively small trading ranges since the bullish harami cross (doji) on 9/9. A new add-on above a cup base pivot of 271.10 exists and respect that this did not pause much at the upside gap fill from the 7/23 session this week. This should be set for a strong year-end run, although the PRICE path will not be a straight line up.

Chinese Laggard?

  • Huh, what? After the week China recorded one may think that was a joke. And it begs the question, if a stock has not gone up in a surging region, keeping pace with peers, is there something wrong with it? Below is the daily chart of MNSO which fits the description. The name is still 34% off most recent 52 week highs, while ETFs like the FXI and KWEB are just 1% off their own annual peaks. The WEEKLY chart shows this could be breaking ABOVE a bearish head and shoulders and we know from FALSE moves come fast ones in the opposite direction.  Looking at the MONTHLY chart gives plenty of information. Firstly, notice the doubling in PRICE in November 2022, and it shows the importance of letting winners run, as many would have loved to cash out up 100% in a month, but it then went from roughly 10-30. From there three straight spinning top candles between September and November 2023 suggested exhaustion. This month with one day left is showing a bullish hammer in gigantic volume as a potential double bottom base takes shape with a pivot of 25.18 from May with a doji. After analyzing three different timeframes my opinion is get long at 16.75 with a CLOSING stop of 15.30.

Recent Examples:

  • Chinese internet retail names soared last week with KWEB jumping 26.8%, its best week since the week ending 3/18/22 which screamed higher by almost 29%. Both of these weeks were accompanied by the strongest WEEKLY volume in at least 5 years and when it occurred in early 2022, there was very little progress afterwards. That does not mean it can not this time around, but the right side of cup bases should be formed in a gradual manner, unlike the skyrocet last week. In my opinion the best solution here would be some sideways digestion before the next potential leg up. Below is the fourth largest holding of the KWEB in JD and how it appeared in our 9/23 Consumer Discretionary note. We admired the bullish island reversal on 9/19 and it has since flew past the inverse head and shoulders pivot of 29 and has already surpassed the measured move to 34. On its MONTHLY chart it completed a bullish morning star in March with a doji candle in February right off the very round 20 number.

Special Situations:

MapleBear:

  • Internet retail play up 70% YTD and 39% over last one year period.
  • Name 7% off most recent 52-week highs and DAILY chart shows nice break above bullish inverse head and shoulders pivot of 37 which carries measured move to 44. Bull flagging on DAILY ratio chart against XRT peers as well.
  • Earnings reactions mostly lower with losses of 3.7, 1.9, and 10.1% on 5/9, 2/14, and 11/9/23 before recent gain of 2.8% on 8/7.
  • Enter after break above WEEKLY cup base pivot.
  • Entry CART here.  Stop 37.

Revolve Group:

  • Specialty retailer up 51% YTD and 94% over last one year period.
  • Name 4% off most recent 52-week highs and MONTHLY chart shows RSI moving quietly back into bullish zone above 50. Monday will see if stock can rise for 3rd straight month for first time since huge drawdown started in Q4 '21 with bearish evening star at very round 90 number.
  • Earnings reactions mostly higher up 32.7, 2.5, and 22.1% on 8/7, 5/8, and 2/28 after a loss of 1.1% on 11/2/23.
  • Enter with buy stop above bull flag.
  • Entry RVLV 26.  Stop 24.75.

Chipotle:

  • Casual diner up 25% YTD and 59% over last one year period.
  • Name 17% off most recent 52-week highs and WEEKLY chart shows bearish spinning top and doji candles last 2 weeks. Notice here on ratio chart against CAVA this has been in a serial decline since late April. Expect relationship to continue.
  • Earnings reactions mostly higher up 6.3, 7.2, and 4.5% on 4/25, 2/7, and 10/27/23 before recent loss of % on 7/25.
  • Enter short after pause following breakout with bearish candles.
  • Entry CMG here.  Buy stop 59.

Good luck.

Entry summaries:

Buy after break above WEEKLY cup base pivot CART here.  Stop 37.

Buy stop above bull flag RVLV 26.  Stop 24.75.

Short after pause following breakout with bearish candles CMG here.  Buy stop 59.

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Start Your Engines:

  • The most talked about automobile name on the planet is shifting into overdrive. TSLA rose more than 9% last week, the second time it has done that in the last 3, and it has now nearly doubled in PRICE since the late April lows. That week recorded a bullish piercing line candle and round number theory played a role with a bullish hammer candle off the very round par number the week ending 1/6/23, and the top was a bearish engulfing candle at 300 the week ending 7/21/23. It now looks back in gear as last week inched above a 260 bullish inverse head and shoulders pivot. The MONTHLY chart shows the importance of candles at critical highs and lows with a doji candle in November 2021 which started the symmetrical triangle we now see. A break above here in October would carry a measured move to nearly 600, which could take 2-3 years but for long-term holders, an appetizing target. On the daily chart, one has to admire the tight trade and relatively small trading ranges since the bullish harami cross (doji) on 9/9. A new add-on above a cup base pivot of 271.10 exists and respect that this did not pause much at the upside gap fill from the 7/23 session this week. This should be set for a strong year-end run, although the PRICE path will not be a straight line up.

Chinese Laggard?

  • Huh, what? After the week China recorded one may think that was a joke. And it begs the question, if a stock has not gone up in a surging region, keeping pace with peers, is there something wrong with it? Below is the daily chart of MNSO which fits the description. The name is still 34% off most recent 52 week highs, while ETFs like the FXI and KWEB are just 1% off their own annual peaks. The WEEKLY chart shows this could be breaking ABOVE a bearish head and shoulders and we know from FALSE moves come fast ones in the opposite direction.  Looking at the MONTHLY chart gives plenty of information. Firstly, notice the doubling in PRICE in November 2022, and it shows the importance of letting winners run, as many would have loved to cash out up 100% in a month, but it then went from roughly 10-30. From there three straight spinning top candles between September and November 2023 suggested exhaustion. This month with one day left is showing a bullish hammer in gigantic volume as a potential double bottom base takes shape with a pivot of 25.18 from May with a doji. After analyzing three different timeframes my opinion is get long at 16.75 with a CLOSING stop of 15.30.

Recent Examples:

  • Chinese internet retail names soared last week with KWEB jumping 26.8%, its best week since the week ending 3/18/22 which screamed higher by almost 29%. Both of these weeks were accompanied by the strongest WEEKLY volume in at least 5 years and when it occurred in early 2022, there was very little progress afterwards. That does not mean it can not this time around, but the right side of cup bases should be formed in a gradual manner, unlike the skyrocet last week. In my opinion the best solution here would be some sideways digestion before the next potential leg up. Below is the fourth largest holding of the KWEB in JD and how it appeared in our 9/23 Consumer Discretionary note. We admired the bullish island reversal on 9/19 and it has since flew past the inverse head and shoulders pivot of 29 and has already surpassed the measured move to 34. On its MONTHLY chart it completed a bullish morning star in March with a doji candle in February right off the very round 20 number.

Special Situations:

MapleBear:

  • Internet retail play up 70% YTD and 39% over last one year period.
  • Name 7% off most recent 52-week highs and DAILY chart shows nice break above bullish inverse head and shoulders pivot of 37 which carries measured move to 44. Bull flagging on DAILY ratio chart against XRT peers as well.
  • Earnings reactions mostly lower with losses of 3.7, 1.9, and 10.1% on 5/9, 2/14, and 11/9/23 before recent gain of 2.8% on 8/7.
  • Enter after break above WEEKLY cup base pivot.
  • Entry CART here.  Stop 37.

Revolve Group:

  • Specialty retailer up 51% YTD and 94% over last one year period.
  • Name 4% off most recent 52-week highs and MONTHLY chart shows RSI moving quietly back into bullish zone above 50. Monday will see if stock can rise for 3rd straight month for first time since huge drawdown started in Q4 '21 with bearish evening star at very round 90 number.
  • Earnings reactions mostly higher up 32.7, 2.5, and 22.1% on 8/7, 5/8, and 2/28 after a loss of 1.1% on 11/2/23.
  • Enter with buy stop above bull flag.
  • Entry RVLV 26.  Stop 24.75.

Chipotle:

  • Casual diner up 25% YTD and 59% over last one year period.
  • Name 17% off most recent 52-week highs and WEEKLY chart shows bearish spinning top and doji candles last 2 weeks. Notice here on ratio chart against CAVA this has been in a serial decline since late April. Expect relationship to continue.
  • Earnings reactions mostly higher up 6.3, 7.2, and 4.5% on 4/25, 2/7, and 10/27/23 before recent loss of % on 7/25.
  • Enter short after pause following breakout with bearish candles.
  • Entry CMG here.  Buy stop 59.

Good luck.

Entry summaries:

Buy after break above WEEKLY cup base pivot CART here.  Stop 37.

Buy stop above bull flag RVLV 26.  Stop 24.75.

Short after pause following breakout with bearish candles CMG here.  Buy stop 59.