American Eagle Outfitters
This retailer is stuck in the mud here with lower highs and lower lows. The dam looks about to break, too, with rather tepid support at the $14 level.
The Relative Strength Index (RSI) is weak and making lower highs while money flow is poor. This being the holiday period we would expect to see retailers produce some good results, but this one is far from good.
Short to the single digits -- that's where this underperformer is headed.
Here's another trendy retailer that has taken its lumps over the years. While the chart may look like a bullish setup there is nothing that is appealing here. Indeed, the rally up into resistance zones makes this a nice short candidate.
A good target is the support level around the $24 area; however, with some gaps below that need to be filled, this stock could move back to the August lows without much effort.
A nice short, but put in a buy stop around the $30 area.
-- Bob Lang and Chris Versace are co-portfolio managers of Trifecta Stocks.