Sell Ralph Lauren on Poor Olympic Dog Outfits

Sen. Harry Reid was clearly miffed when he saw the US Olympic Team outfits designed by Polo Ralph Lauren, $RL. News media stated that it was because he learned that the garments were made in China. But in fact I’m told that the real reason is because of the blatant lack of taste in the poodle outfits (who knew poodles even competed in the Olympics?). There really was not much

design put into this. Investors seem to be siding with Harry. The weekly chart, below, shows that the stock is breaking down out of a bear flag, with a price target of 100. The Relative Strength Index (RSI) has been hovering in bearish territory and is turning lower with a Moving Average Convergence Divergence indicator (MACD) that remains negative. For a slightly different view, a close below 136 on the 3-box reversal Point and Figure Chart would break through support and trigger a price objective of at least 106 using a $2 box and close only. But the daily chart says not

Polo Ralph Lauren, $RL, weekly

so fast. With a Hammer print on Thursday, that if confirmed would create a double bottom, it would take a new low, under 134.29 to trigger a short. With the MACD about to cross negative and the RSI bearish and heading lower there is good support for that downside to continue. Maybe Friday will be the day. Should the Hammer confirm higher then it is a name to avoid until it moves over 150.

Polo Ralph Lauren, $RL, daily

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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