Lululemon Athletica Inc. - (LULU) - November 15, 2023
Yoga and athletic clothing retailer Lululemon Athletica (LULU) has been steadily making its way back up the relative strength rankings in the SIA NASDAQ 100 Index Report since June. Following gains of 5 spots yesterday and 23 positions in the last month, Lululemon finished yesterday in 26th place, returning to the Green Favored Zone for the first time since May.
The retailing sector has been attracting increased attention this week with US retail sales due today, and US retailer earnings season now underway. Other retailers and specialty retailers in the Green Favored Zone of the NASDAQ 100 Index Report include PDD Holdings (PDD), Copart (CPRT), and Mercadolibre (MELI).
A major breakout is underway in Lululemon (LULU) shares. After spending nearly two years trending sideways, LULU has completed a bullish Ascending Triangle base, signaling the start of a new uptrend. Last month, the shares gapped up and broke out on a big spike in volume, a sign of increased investor interest. Following a couple of weeks of normal backing and filling, the new advance has gained traction with the shares rallying up toward $430.00 this week, their highest level in nearly two years.
Upside resistance may initially emerge at the late 2021 peak near $480.00, followed by the $500.00 round number, and then the $540.00 to $560.00 zone based on measured moves. Initial support appears near $400.00, a round number and recent breakout point.
Since the beginning of 2022, Lululemon (LULU) shares had been stuck in a sideways range, trading between approximately $260.00 and $400.00. Since June, accumulation has been accelerating with the slope of the uptrend support line increasing. This month, Lululemon has broken out over $410.00, with a Double Top breakout building on a previous Triple Top breakout and signaling the start of a new advance.
Initial upside resistance may appear at the November 2021 peak near $479.55, followed by the $500.00 round number, and $519.10, where vertical and horizontal counts converge. Initial support appears near $393.40 based on a 3-box reversal.
With a perfect SMAX score of 10, LULU is exhibiting strength across the asset classes.
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