Don't Ignore This Chart!

Reverse Head & Shoulders Pattern Worth A Gamble?

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Gambling stocks ($DJUSCA) have been BY FAR the worst performing industry group within the consumer discretionary sector over the past year, dropping 27.72%.  There are only two other industry groups in this sector in negative territory - clothing & accessories ($DJUSCF) and recreational products ($DJUSRP) which have fallen 8.44% and 2.40%, respectively.  Gambling stocks have rebounded an astounding 29% in the past month as they set up in a potential reverse head & shoulders pattern.  While the return over the past month has been very strong, a breakout of this pattern would measure another 140 points, or roughly 25%.  To confirm the pattern, look for a heavy volume breakout to clear neckline resistance.  Here's 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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