• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Doug Kass
    • Bruce Kamich
    • Jim Cramer
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • Trifecta Stocks
  1. Home
  2. / Investing

No Polo Game for Ralph Lauren as This Breakout Is Real

Let's see if this price jump is a one time event or the start of a bigger advance.
By BRUCE KAMICH
Nov 08, 2019 | 09:44 AM EST
Stocks quotes in this article: RL

At the top of Jim Cramer's Mad Money program Thursday night, he mentioned retail and pointed out the strength in Ralph Lauren Corp. (RL) which shot up 14.6% on strong earnings, taking much of the retail sector along for the ride. 

Let's check in on RL to see if this price jump is a one time event or the start of a bigger advance.   

In this daily bar chart of RL, below, we can see that prices were improving before Thursday's gap higher. RL made a low in August and a higher low in October. On Wednesday RL closed just below its September high and yesterday it gapped above that high to create or start an uptrend (higher high and higher low).
 
RL also gapped above the bottoming 200-day moving average line and it was above the rising 50-day line from the middle of October.
 
The On-Balance-Volume (OBV) line bottomed with price in August and it has moved higher signaling to us that buyers of RL have been more aggressive for several weeks now.
 
The Moving Average Convergence Divergence (MACD) oscillator crossed above the zero line in October for an outright go long signal. All before Thursday's gap to the upside. Thursday's rally also pushed RL through most of the overhead resistance from June/July. 
 
 
  
 
In this weekly bar chart of RL, below, we can see that prices are above the declining 40-week moving average line. A steady close today (Friday) will give us a weekly close above the line.
 
The weekly OBV line has been strong since the middle of August and tells us that buyers on this time frame have been more aggressive. The MACD oscillator crossed to the upside in October generating a cover shorts buy signal. 
 
 
In this Point and Figure chart of RL, below, we used weekly close only price data to construct this chart. The software has generated a potential price target of $162 or a breakout over the peak of 2018.  
 
 
Bottom line strategy: Bernard Baruch would be impressed if he were alive today. First by the strength and longer-term price target for RL, and secondly because Ralph Lauren dropped out of Baruch College and still became a big success. Traders could go long RL or add to longs on any one or two day dip. Risk below $100 for now.
Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

Employees of TheStreet are prohibited from trading individual securities.

TAGS: Earnings | Investing | Stocks | Technical Analysis | Trading | Apparel | Retail | Mad Money

More from Investing

Tech Gives Push to Market's Rotation

James "Rev Shark" DePorre
Jan 20, 2021 4:49 PM EST

Money moved back into big-cap technology names, thanks to strong positive reactions to earnings from Netflix.

I'm Focused on the Weekly Setup With SelectQuote

Timothy Collins
Jan 20, 2021 3:05 PM EST

These broken IPOs that start to heal can be some of the best trades.

Netflix's Post-Earnings Surge Might Bode Well for Microsoft, Facebook and Amazon

Eric Jhonsa
Jan 20, 2021 2:40 PM EST

The streaming giant's numbers and commentary were arguably just good, rather than amazing. But with its stock having underperformed for months, that's all that markets needed.

DuPont Could Push Higher in the Weeks Ahead After Some Sideways Consolidation

Bruce Kamich
Jan 20, 2021 2:38 PM EST

Here's our strategy now.

Be a Scale Up Seller of Quanta Services

Bruce Kamich
Jan 20, 2021 1:58 PM EST

Let's check the charts and indicators.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 11:38 AM EST CHRIS VERSACE

    Best Stocks to Buy for the Biden Presidency

    President-elect Biden's massive stimulus plan, int...
  • 08:07 AM EST GARY BERMAN

    Wednesday Morning Fibocall for 1/20/2021

    SPX (Long-Term View) The 1/8/21 high @ 3826.69 i...
  • 11:09 AM EST GARY BERMAN

    Is Copper About to Turn to Rust?

    Below is a very long-term copper chart.  As you...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2021 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login