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Stella Jones Inc. - (SJ.TO) - June 7, 2024

Stella-Jones (FP.TO) is a forest products company who produces specialty pressure treated lumber for industrial applications like telephone poles and railroad ties.

After spending nearly a year in the green zone of the SIA S&P/TSX Composite Index Report Stella-Jones shares tumbled down into the red zone over March and April. It did not remain depressed for very long, however, as it has been steadily working its way back up the rankings for the last six weeks toward the top of the Yellow Neutral Zone.

Yesterday, SJ.TO moved up 6 spots to 58th place, two spots away from a return to the green zone for the first time since February. Stella-Jones has climbed 57 positions in the last month.

The last time Stella-Jones was in the green zone between March of 2023 and February of 2024, it gained 34.9% compared with a gain of 5.9% for the S&P/TSX Composite Index over the same time period.

Candlestick Chart Hits a New High. Stella-Jones (SJ.TO) shares staged a major breakout yesterday. Since October, the shares had been trading back and forth in a range between $71.00 and $86.00, consolidating a previous major advance. In early May, the shares successfully retested channel support and following a correction, quickly re-established a emerging uptrend of higher lows.

Yesterday’s breakout to a new all-time high, signals the start of a new advance. A measured move from the recent range suggests potential resistance near $101.00, just above the $100.00 round number. Initial support climbs to the recent low near $80.00.

Point and Figure Chart Breaks Out. An 18-month uptrend in Stella-Jones (SJ.TO) ran out of gas late last year and for nearly six months, the shares have been in consolidation mode, trading between $71.60 and $85.50. Recently, the shares have started to advance once again, completing bullish Triple Top and Spread Double Top breakouts, and rallying to a new all-time high, signaling the start of a new advance.

In addition to the $100.00 round number, clusters of vertical and horizontal counts suggest potential upside resistance may appear on trend near $98.39, $104.20, or $110.70 on trend. Initial support appears near $79.05 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 8 out of 10, SJ.TO is exhibiting short-term strength against the asset classes.

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