Soup season is upon us, but Campbell Soup ($CPB) is having none of it as the stock trends lower and lags its sector, the Consumer Staples SPDR (XLP).
First and foremost, the long-term trend is down with a 52-week low in June, the 50-day below the 200-day and the 200-day EMA falling. The stock bounced back to the 200-day in August, but turned back down the last few months.
CPB gapped up in June and held this gap for over a month, but selling pressure picked up again in August and the stock broke support levels. Note the lower lows in late August and September. The stock is currently struggling at 39 and this level marks first resistance.
The Consumer Staples SPDR (XLP) bucked market selling pressure in October with higher highs in both September and October. CPB, in contrast, remains well below these highs and is underperforming XLP.
The other indicator window shows the PPO (5,30,5) stalling just below the zero line and starting to turn down as the indicator broke its signal line. This looks negative for CPB and I would re-evaluate this bearish stance on a close above 39.
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Topics for Tuesday, October 31st:
- New Low Parade Grows (FB, C, GS, LMT, SLB, FDX, TXN)
- %Above EMA Indicators (way oversold, BUT)
- XLV Stalling at Potential Reversal Zone, BUT (plus XLP, XLU)
- Bear Wedge for TLT (plus Junk Yields Rise)
- Gold and Natty Hold Breakouts
- AskArthur Q&A: MA Settings, Cash and Drawdowns
- Click here to Watch
Plan Your Trade and Trade Your Plan.
- Arthur Hill, CMT
Senior Technical Analyst, StockCharts.com