Stock Chart Analysis BKE
The Buckle, Inc. (Public, NYSE:BKE)
While I've been bullish for the past several weeks, I always have a few short ideas in my watchlist in case I am wrong on my market analysis. I also like to have some short setups available in case the markets get overbought and begin to reverse. I don't want to bail out on positions that are behaving well, but I also don't have any interest in sitting through a pullback unhedged.
Currently, the markets are behaving very strongly, but they are also starting to get over heated. In these situations, I start looking for stocks that are not participating and therefore likely candidates to lead the way down on weakness. I have no desire to short strong stocks "that are too high".
BKE is a stock that I've been watching for a few weeks, and in fact wrote about for Investopedia on July 14th. While it has been a strong stock if you look at its performance over the past year, it has basically gone no where over the past month. While technically, its consolidating, it is also in a vulnerable spot here. BKE began the consolidation after a strong breakout from March - April. The consolidation ran into trouble in June, when BKE failed to rise to the top of the established trading range. It then proceeded to break under the prio two pivot lows, but did find support and climbed back into the base. It is now back to the trendline and also under a declining 50-day moving average. A break under recent trading range could lead to a full fledged breakdown. With a clearly defined stop loss above 32.50, BKE could offer a decent trading setup. While I'm not ready to start shorting gung ho, I will be watching BKE and charts like it over the next few days.
Good Trading,
Joey
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