Shares of Marriott Vacations Worldwide (VAC) had a big selloff in 2015 and then a rebound. Prices are rolling over again and it looks like it is time for stay-cation -- staying away from the long side of VAC.
Shares of VAC peaked at over $90 last year and tumbled down near $45 by last January and February. In September 2015, there was a death cross of the 50-day and 200-day moving averages and this month we witnessed a golden cross as the 50-day moved above the 200-day line. The On-Balance-Volume (OBV) line has been weak the past year as sellers dominated with heavier volume on days when VAC closed lower. There was an uptick in the OBV line in March and April but the line is back to its lows again. A bearish divergence this year is also a negative signal looking forward. Prices made equal highs this year but the momentum reading made a lower high, signaling the rally had weakened.
In this three-year weekly chart of VAC, above, we can see prices are back below the declining 40-week moving average line. Prices had been above the line but the trend of the average remained negative. The OBV line has made a lower high and is weakening. The MACD oscillator is narrowing to a new sell signal. Putting it all together, I would look for VAC to trade lower to retest the $50-$45 area again in the months ahead.