At Your Discretion

March 30, 2022

So far this year, one of the worst performing sectors has been Consumer Discretionary. That may be changing, and fast. $TSLA and $AMZN are getting all the headlines, but digging into space, we see quite a few other setups in less popular (and crowded) names. A couple at the bottom as very small market caps, so plan accordingly.

Ticker: $TSCO

It is hard not to start with Tractor Supply, a retailer that focus on the Ag space. It saw a strong ABC pullback into late February and hasn’t looked back since.  Over the last few weeks it moved sideways after being rejected at its first challenge of the highs.  Forming a bull flag up here with RSI in a bull range and muddling along while it builds energy. The weekly tested both the MA bands and the RSI bull range into that low, this did a good job of working off the high readings and leaves it better set up for a potential break.

Ticker: $MELI

MercadoLibre has broken its small base and is now moving over the small flag it built on top of that breakout.   It still needs to clear the downtrend, but I see that as secondary to the volume shelf it is clearing now. Weekly is back testing the underside of a polarity level and the MA bands as it works off the large positive divergence that setup into the lows. 

Ticker: $DECK

Deckers Outdoor is attempting a reversal. It currently has a small head and shoulders bottoming pattern forming after testing the trendline break from last week.  A break of the headline would allow it to join the party and potentially retrace more of this downtrend.  The RSI has not shifted to a bull range yet, so these breaks are critical to help foster that shift as well.  Weekly has a long way to go before we expect a shift here, so decide if this is a longer play or just a trade and size accordingly.

Ticker: $UAA

Under Armour is on the verge of a daily RSI bull range shift after a small breakaway gap put it over the down trend line and right into the breakout level. Weekly move back above 50 without spending much time under, but lots of distance to cover before it shifts back to a bull range. This puts this one in a trade for now and see how things progress for now basket too.

Ticker: $ELY

Callaway Golf another name that looks to be just now emerging from a downtrend. The daily chart has not quite shifted to an RSI bull range, but is heading there fast with any continuation here.  Closing yesterday right over both the down trend line and the volume node to enter the Kirby which could send it to the daily VPOC fast. Weekly held its pre-Covid highs.  first challenge will be getting back over the MA bands, then clearing the longer down trend off the highs from last summer.


Ticker: $MOV

With a sub $1b market cap, even this is a great-looking chart setup needs to be sized accordingly. Movado pulled back early and maybe even a little less than many peers. The Weekly chart held the RSI bull range during the correction and is now heading higher.  The daily RSI is making a bull range shift here as we challenge the volume node.  Over this level clears the way to test the December highs. Breaking that would complete the handle in this large cup and handle base that has been building a while now.

Ticker: $MGNI

Magnite is a small cap name in the space that is setting up to clear a nice base while forging a fresh RSI bull range. The weekly RSI is in a deep bear range, but price helda big shelf and looking for higher highs. Back to the daily we can see the small flag that formed in the MA bands got its break yesterday on volume. If that helps catapult us through the larger base breakout the top of value up near 18 is the milestone, then if it can clear that, the breakdown gap near 28 is a target.

Ticker: $LQDT

Liquidity Services is another small company that is making headway on its reversal attempt as it forges anew RSI bull range. The daily is now in a vacuum that could suck it higher into the VPOC. On the weekly, price poked below the volume support and the RSI bull range and started working its way higher almost immediately. 

The charts and tickers above are for educational purposes and are not recommendations to do anything.  This is just to help show you what we see and then let you take it from there and do your own due diligence. Either build your own trade plan or get with your advisor or broker form one before considering any ideas above.