Don't Ignore This Chart!

DKS Sports A Test Of Long-Term Support

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Retailers were rocked on Friday with the five worst performing industry groups all in the retail space.  The S&P Retail index (XRT) dropped nearly 4% on Friday and more than 8% last week.  Many of the retail industry groups and stocks within those groups are at or challenging October 2014 lows on the heels of a poor monthly retail sales report that was released in pre-market action on Friday.  One of those companies, Dick's Sporting Goods (DKS), is testing an area of price support it's tested on several previous occasions over the past 3-4 years.  The 39.00-41.00 price support is very important for DKS in order to maintain its higher high and higher low uptrend off the 2009 lows.  One warning sign of a potential top in March 2015 was the unusually low volume that accompanied that final breakout (blue arrows).  Since that time, volume has accelerated as DKS has fallen roughly 30% off its high.  Check out the chart:


Happy trading!

Tom

Tom Bowley
About the author: is the Chief Market Strategist at EarningsBeats.com, where he provides stock market education, guidance, and trading strategies using a unique combination of technical, fundamental, and historical analysis. Tom provides EarningsBeats.com members with four portfolios (Model, Aggressive, Income, and Value), all designed to beat the benchmark S&P 500, and a revolving Watch List of hundreds of companies reporting strong quarterly earnings (must beat both revenue and EPS estimates) and exhibiting technical strength as well. These companies comprise EarningsBeats' annotated Strong Earnings ChartList (SECL), from which Tom trades exclusively. Tom writes a Daily Market Report (DMR) for members to include an executive summary, market outlook, sector/industry watch, and trading ideas. Learn More
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