Burlington's Charts Should Please Those Shopping for the Stock

Here's our latest analysis and trading strategy for this retail name.

In Jim Cramer's recent Real Money column "This Is a Brave New Economy We're In" he noted that investors have been buoyed by stimulus checks, which have been flowing into companies like AutoZone (AZO)  and Burlington Stores (BURL) . 

Let's check and see what is happening with Burlington. 

In the daily bar chart of BURL, below, we can see that share prices were more than cut in half but they have made an amazing recovery since the middle of March. BURL is back above the rising 200-day moving average line as well as the rising 50-day moving average line.

The trading volume has been active since early March and the On-Balance-Volume (OBV) line has strengthened since the middle of March and now stands at a new high for the move up. This strength in the OBV line tells us that buyers of BURL have been more aggressive.

The Moving Average Convergence Divergence (MACD) oscillator is above the zero line and pointed upward in bull alignment. 

 

 

In the weekly bar chart of BURL, below, we can see a bullish picture -- prices are in an uptrend and above the rising 40-week moving average line.

 

The weekly OBV line is firming again and the MACD oscillator just crossed for a cover shorts buy signal.

 

 

In this daily Point and Figure chart of BURL, below, we can see an upside price target in the $242 area. Not a new high but it is a start. 

 

 

 

Bottom-line strategy: Trade BURL from the long side risking below $195. The $242 area is our first upside price target.

 

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