Don't Ignore This Chart!

What Part of Advanced Auto Parts' Chart Do You Like?

 | 

Advanced Auto Parts (AAP) has been struggling around the 170 level for years and we are back to that level once again. The SCTR has been strong, having recently pulled back as price consolidated through the first quarter. The SCTR is a method of comparing the strength of price moves across a group of stocks. I like to find stocks moving into the top quartile (i.e. above 75).  The full stochastic is moving back above 50, which is also good on a weekly chart. The PPO is a momentum indicator. There are four real phases of momentum: rising below zero, rising above zero, declining above zero and declining below zero. Turning up just above zero is a very positive sign. This stock has a nice setup and looks strong.

If this market is going to start running into a bigger bull market, we should see some rotation into new leaders. One of the reasons I like the chart here is that we are also seeing Genuine Parts (GPC) and Autozone (AZO) break out to new highs as well. I quite like when whole industries are setting up a move to new highs. 

Here is the chart for Genuine Auto Parts:

Autozone has already made a big move, as seen in the chart below.

With all of these factors in play, a stop at the 40-week moving average should give this stock room to run.

Good trading,
Greg Schnell, CMT, MFTA
Senior Technical Analyst, StockCharts.com
Author, Stock Charts for Dummies

Hey, have you followed Greg on Twitter? Click the bird in the box below!

twitter linkedin

Want to read more from Greg? Be sure to follow his StockCharts blog:
The Canadian Technician

Announcement from the Author

{{ announcement.content }}

Greg Schnell
About the author: , CMT, is a Senior Technical Analyst at StockCharts.com specializing in intermarket and commodities analysis. Based in Calgary, he is a board member of the Canadian Society of Technical Analysts (CSTA) and the chairman of the CSTA Calgary chapter. He is an active member of both the Market Technicians Association (MTA) and the International Federation of Technical Analysts (IFTA).

Greg is also the co-author of Stock Charts for Dummies (Wiley, 2018). Greg joined StockCharts.com in 2012 and has be instrumental in helping launch a variety of new blogs and other commentary platforms. Presently, Greg contributes market analysis commentary to The Canadian Technician, Commodities Countdown and Don't Ignore This Chart blogs. Learn More
Subscribe to Don't Ignore This Chart! to be notified whenever a new post is added to this blog!
comments powered by Disqus