All Weight Loss Programs Are Not Alike!
- Posted by Greg Harmon
- on January 24th, 2013
Sounds like a commercial right? January is the time to go the gym, sign up for a membership you will never use and then go on a diet. Two major competitors do all that they can to get your weight loss business, Weight Watchers, $WTW, and NutriSystems, $NTRI, and many will think it does not matter which one you use. That may be true but it does matter which stock you might pick to trade. Take a look.
Weight Watchers, $WTW
Weight Watchers, $WTW, got beaten up badly after it reported earnings in May 2012 finally bottoming in August. Since then it has been trending higher, making a series of higher lows along the rising trend line, and nearly retraced 50% of the move lower. Since that peak in January though it has been pulling back and is now retesting support at the Simple Moving Averages (SMA). Notice that a Golden Cross is about to print and the relative Strength Index (RSI) is holding in bullish territory despite the Moving Average Convergence Divergence indicator (MACD) diverging, crossing to negative. There is still risk of a further pullback in this stock which may give you a better entry at the rising trend line. On the other hand NutriSystems, $NTRI, looks primed to go. It also fell hard, after its last earnings release in November. It is also stair stepping higher with a series of
higher lows and higher highs. At the 50 day SMA now it is forming a bull flag for another move higher. It has support from the RSI that is rising and bullish and a MACD that averted a cross to negative. In fact, Thursday’s price action could be interpreted as a move higher from consolidation at the 38.2% Fibonacci level. With a gap fill in sights and resistance above that at 9.70, which coincides with the 61.8% retracement of the move lower and the 200 day SMA, this looks like a much better trade, against a stop in the 8.690 area, than Weight Watchers at the moment.
Join the Dragonfly Capital Views Premium Membership
Sign up here to get deeper analysis and nearly 50 trade ideas every week.
If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.
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.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
Dragonfly Capital Updates
- SPY Trends and Influencers March 8, 2014
- Cleveland’s Best Linkfest!
- Macro Week in Review/Preview March 7, 2014
- Top Down Options Trading, Risk Management, and Collars
- Time to Sell Corn?
- Long Term Pick of the Week: Bridges, Iron and Voodoo
- Premium Earnings 3-6-14
- Your Second Chance in Natural Gas Is Here
- The Third Pitch From OpenTable
- Premium Earnings 3-5-14