Two months ago I reviewed two retail names ahead of Black Friday, one was Five Below (FIVE) and the other chain was Tuesday Morning (TUES) . The sales are over and the returns have been made, but a look back at how we did is a good exercise. We said, "FIVE has been trading sideways the past month but I expect it to go higher. Traders can buy FIVE here and risk a close below $53 looking for gains potentially to the low $80s." For TUES we said, "Shopping for a low-priced stock? Consider going long TUES on a close above $3.30 risking a close below $2.50. My price targets are $5.00 and $6.00."
In this daily bar chart of FIVE, below, we can see that prices have climbed nicely and are getting close to our low $80's price objective. Traders can maintain those longs and raise sell stop protection to a close below $64. The moving averages remain bullish and so does the On-Balance-Volume (OBV) line. Momentum has slowed from early December to early January and that tells us the pace of rally could be slowing.
In this chart of TUES, below, we can see that prices have not done much. TUES did not close above $3.30 to signal a breakout but since our November review TUES has crisscrossed above and below the 50-day average line which is just now turned up again. TUES is above the flattening 200-day line and that is an improvement. The OBV line is steady and the Moving Average Convergence Divergence oscillator is above the zero line and could turn up to an outright go long signal. If you are still looking for a low-priced retail name I would still buy a close above $3.30.
