Tapestry (TPR) gapped to the downside recently. Is this a successful retest of the December low or is it foreshadowing new lows ahead? Let's see what the charts and indicators suggest for the parent of names like Coach and Kate Spade.
In this daily bar chart of TPR, below, we can see the recent downside price gap or void accompanied by very heavy volume. If you look close you should be able to see that prices closed well off their lows yesterday and are trading higher this morning. This is not a guarantee but it is a sign that the test of the December low at $32 could hold.
This does not mean that TPR is out of the technical woods as prices are below the declining 50-day moving average line and the bearish 200-day moving average line.
The daily On-Balance-Volume (OBV) line shows a decline from August and tells us that sellers of TPR have been more aggressive.
The Moving Average Convergence Divergence (MACD) oscillator recently moved above the zero line but that buy signal looks like it will quickly be reversed.
In this weekly bar chart of TPR, below, we can see the sharp move lower this week without the gap on the daily chart.
The close today is not known and where the weekly OBV line finishes.
The weekly MACD oscillator recently crossed to the upside for a cover shorts signal but that could be reversed.
In this Point and Figure of TPR, below, we can see the sharp decline without a gap. We can see a new low of $31.96 and that a downside price target of $25 is being projected.
Bottom line strategy: From a short-term perspective it looks like TPR has escaped a decisive break of its December low, but who knows what next week will bring? The safest trade right now is to consider buying a Coach product rather buying TPR, the stock.