Foot Locker (FL) was last reviewed back at the end of March, where I wrote that "While the technical picture for FL is still mixed, we see an attractive trade from the long side. Aggressive traders cold go long FL risking below $40 looking for gains to the low $50s." FL gapped higher in late May and nearly reached $60 on that advance. Prices corrected down to retest the rising 200-day moving average line earlier this month and we could see another rally to new highs for the move up.
Let's check out the charts again.
In the daily bar chart of FL, below, we can see that prices have been in an uptrend since November. A rally above the June high will refresh the rally. FL is above the declining 50-day average line and above the rising 200-day line.
The daily On-Balance-Volume (OBV) line has been rising since November telling us that buyers of FL have been more aggressive. The OBV line is close to making a new high for the move up. The Moving Average Convergence Divergence (MACD) oscillator crossed to a cover shorts buy signal earlier this month and is close to moving above the zero line for an outright go long signal.
In this weekly bar chart of FL, below, we can see that prices are above the rising 40-week moving average line. The weekly OBV line has been positive since August 2017 and the weekly MACD oscillator is poised to cross to the upside from above the zero line -- this would be a fresh go long signal.
In this Point and Figure chart of FL, below, we can see an upside price target of $63.58 being projected. This would be a new high for the move up.
Bottom-line strategy: FL may decline Friday, but the stock's longer-term pattern suggests higher prices in the weeks ahead. Hold longs or buy a dip risking below $45. The $65 area is my next price target for FL.