Buckle Up for Ride Higher
- Posted by Greg Harmon
- on October 14th, 2013
Buckle, $BKE, took a header after reporting weak retail sales last week. To be fair, the teen and tween retail space has been very fickle and anyone that one’s one of these (teens or tweens) can understand why. The stock sold off about 10% on volume that had not been seen since June 2012. This makes your mind wander to thoughts of capitulation, and a rebound. The chart shows that the Relative Strength Index (RSI) fell to 20 and the price moved below the 200 day Simple Moving Average (SMA) for the first time this year, finishing outside of the Bollinger bands. It is not enough for the price to move demonstrably lower in one day on large volume and to extremes to warrant a turn around though. Preparing for one
is prudent but pulling the trigger can lead to a big loss. The set up over the next two days, Friday and Monday is positive for a rebound, printing back to back Hammer reversal candles. The second has confirmed the first higher as well. A move back over the 48 level Tuesday can now be played to the upside against a stop just under 47. Remember, it does not have to bounce. It cannot correct for all the oversold indicators through time moving sideways as well. Don’t trade it without the stop and keep an eye on it.
Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through September 2013 Expiry and sign up here for the free 7 day trial before you pay.
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)
- Unlocked: IBM and Under Armour Earnings trades
- Marking 5 years of pain in BP with a bullish trade
- Premium Earnings 4-20-15
- Top Trade Ideas for the Week April 20, 2015: Bonus Idea
- Top Trade Ideas for the Week of April 20, 2015: The Rest
- Top Trade Ideas for the Week of April 20, 2015: The Rest Premium
- Top Trade Ideas for the Week of April 20, 2015: The Best
- SPY Trends and Influencers April 18, 2015
- Macro Week in Review/Preview April 17, 2015
- Dragonfly Capital Views Performance through April 2015 Expiry