The share price of Finish Line (FINL) has suffered in the past twelve months as a decline that started in 2014 gained speed on the way down in recent months. With prices for Finish Line back to levels that have not been seen since 2009, the question is whether these levels are attractive to longer-term investors.
A quick look at the chart of FINL, below, shows a number of price gaps in its downward path. The most recent gap saw heavy turnover and prices closed near the highs of the day. Sometimes a strong close after a new record low can mean that the decline was "overdone". A firm close on Tuesday, however, needs follow through buying or confirmation. If FINL can build on yesterday's close we would be impressed, but a failure to attract buying can mean that further liquidation/selling needs to happen.
In this daily bar chart of FINL, above, we can see that prices are below the declining 50-day moving average line. Since December every rally to the 50-day line has been a selling opportunity. The slower to react 200-day moving average line is also in a downtrend. The volume pattern is hard to read just below the price char but the daily On-Balance-Volume (OBV) is another story. The OBV line has been moving lower the past twelve months and tells us that sellers of FINL have been more aggressive with heavier volume seen on a days when FINL has closed lower. The bottom panel of this chart displays the 12-day momentum study. This indicator is simple math -- today's price for FINL minus the price 12 days ago. If prices are lower than 12 days ago the readings are below the zero line. This indicator needs to be compared against the price action for bullish and bearish divergences. Currently the momentum indicator and the price action are in sync and there is no bullish divergence to tell us the decline has slowed.
In this weekly bar chart of FINL, above, we can see more of the decline that has taken prices from around $32 to below $8. Prices are below the declining 40-week moving average line. The weekly OBV line has been weak for many months signaling more aggressive selling on this time frame. In the lower panel there is a bullish divergence from February to August as prices made lower lows but the momentum indicator made equal lows.
This Point and Figure chart of FINL, above, is pretty dramatic looking as there are several prolonged declines (column of O's). A long-term price objective of $10.77 has been met.
Bottom line -- now that the share price of Finish Line is down to a shoe size, some may find it attractive again. The price action for FINL will need to prove itself with signs of accumulation and not further distressed selling. A re-test of the recent low and base building is needed if FINL is going to see the checkered flag.