Happy Pawn Season!

• Posted by Greg Harmon
• on September 29th, 2015

Yesterday I noted a few large cap high dividend consumer names that appear to be holding up well in this correction. Some investors and traders would look at this and suggest that money is hiding there to avoid most of the damage.

This behavior was something we saw in the market for almost a year after the 2009 bottom. Investors and traders not convinced yet that all was clear, the high dividend names led the market higher for a while. One other thing we saw back then was strength in the pawn shops and payday lenders, um, I mean, specialty retail financial services companies, like Cash America, $CSH.

The chart of Cash America stock above shows a rise with the financials early in the year and then a leveling out. it pulled back with the market into the August 24th low as well. But then it did something crazy. It has moved higher in a couple of steps to new all-time highs.

It might be ready for a pullback or consolidation like the one that happened to start September, as the RSI has pulled back a little and the MACD is crossing down. But keep an eye on the 50 and 100 day SMA’s around 26.75. A hold there may prove to be a good entry if this scaredy-cat environment keeps up.

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