Costco Wholesale Corp. (COST) - May 26, 2025

The last time we highlighted Costco Wholesale Corp. (COST) in our Daily Stock Report was last year on June 27, 2024. At that time the shares were exhibiting a steady uptrend which began in October of 2023. The SIA Platform issued a green favored zone signal in the SIA S&P 500 Index Report back on October 2, 2023, at a price of $571.31. At the time of our last commentary on June 27, 2024, the shares were priced at $856.84, representing an approximate 50% increase in price since the green favored-zone signal. Since then, the shares have continued to strengthen, with the closing price now at $1,008.50; an additional 18% increase since the June 27, 2024, closing price. This reveals a total increase in price of approximately 77% since the initial favored-zone signal back on October 2, 2023.

The shares currently hold the #95 position within the favored zone of the SIA S&P 500 Index report. This serves as a strong example of the importance of remaining invested in names that fall within the green favored zone, and it continues to support SIA’s approach of identifying and sticking with top performers that show strong relative strength, especially as broader market interest grows in the name.

In looking at the candlestick chart we see a sideways consolidation pattern from late 2021 to late 2023 within the $400 to $580 range. Then, in December of 2023, the shares broke out above the $580 resistance range and a steady pattern of higher highs and higher lows formed through until February of this year when the shares hit a ceiling at the $1070 level. There was a sharp but brief dip in the shares when they found support just under the $900 level back in the March and April timeframe. This $900 support level coincides with where the shares found some support back in October of 2024. However, since last month, another upleg has materialized, with the shares trending above the $1,000 psychological level and approaching the recent high of $1,070, which was reached back in February. It will be interesting to see going forward if the shares can continue its strength and reach this upcoming resistance level. To the downside, support is just under the $900 area.

Time to check in on the latest Point and Figure Chart. Known for its clarity, this charting style is especially effective in spotting trends and signaling reversals. In our last commentary, back in June of last year, we noted that the shares were firmly entrenched in a strong upleg. This began with a very strong rising column of 26 X’s from April 2023 to March 2024, without even a 3-box reversal. From that point, a pattern of higher highs and higher lows formed, continuing until the recent peak at $1,063.00 in March of this year.

A sharp pullback followed, forming a column of 9 O’s, which ended when the shares found support at the $889.00 level. Now, we’re seeing a new column of rising X’s that has broken above a previous resistance level at $1,002.00, which was reached in December. The shares are trending toward the recent high of $1,084.00, which now serves as the next area of resistance.

To the downside, support is identified at the 3-box reversal level of $944.31, followed by $889.84. With a SMAX score of 7 out of 10, COST is showing strong near-term strength relative to other asset classes and is currently forming a bullish double top pattern.