SIACharts Logo

Commentary >

Aritzia Inc (ATZ.TO) - January 12, 2024


Abrupt changes in rankings within SIACharts reports can flag to investors significant changes in investor sentiment. Clothing retailer Aritzia (ATZ.TO) jumped 90 positions within the SIA S&P/TSX Composite Index Report yesterday, leaving the red zone and climbing up into the upper half of the Yellow Neutral Zone. This run up the rankings was driven by a 21.0% gain in the share price yesterday on the back of a surprisingly positive earnings report.

Aritzia had struggled in the relative strength rankings for much of last year. It dropped out of the green zone in December of 2022, and entered the red zone almost a year to the day from its exit. The shares spent much of the summer at or near rock bottom but had started to climb within the red zone starting in mid-October. Prior to yesterday’s rally the shares had been down 47.3% over the year they spent in the red zone, compared with a 5.25% gain for the benchmark index ETF over the same period. Candlestick Chart Breaks Out of a Base:

A major breakout is underway in Aritzia (ATZ.TO) shares. From the fall of 2020 through to last summer, the shares were under distribution, the worst of which came in a big washout drop on a spike in volume back in July. Aritzia then spent the rest of last year bottoming out and forming a saucer bottom base for recovery and a bullish Ascending Triangle. This week, accumulation appears to be getting underway in earnest with the shares breaking out of their base and out of a downtrend on a spike in volume.

Previous highs suggest potential resistance may emerge near $37.00 and $44.00 on trend, along with the $40.00 round number. Initial support appears near the $30.00 round number.

Point and Figure Chart Turns Back Upward:

A year-long downtrend in Aritzia (ATZ.TO) shares bottomed out in a Bear Trap back in October, when they broke down by one row then reversed upward. Since then, an uptrend of higher lows has emerged, and the shares have completed a series of bullish Double Top breakouts. Yesterday, the shares rallied to their highest level since July, a sign of continuing accumulation.

Initial upside resistance tests appear in the $36.15 to $39.10 range where column highs/lows, a horizontal count and a downtrend line cluster, followed by $40.70 based on a vertical count. Initial support appears near $29.05 based on a 3-box reversal.

With a bullish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of 7 out of 10, ATZ.TO is exhibiting short-term strength against the asset classes.

Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.

Related Posts

Keep up to date on the latest financial market news.

Receive a daily newsletter with stock highlights, ETF rankings, weekly market focus and others.