Fairlead Strategies Idea Generator
New Long Idea
Idea of the Week
As the S&P 500 Index (SPX) approaches its highs, we are looking for stocks with compelling breakouts as long ideas. We found a mid-cap retailer that is making new highs with momentum to the upside in absolute and relative terms.
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Today’s new long idea is outlet store Ollie’s Bargain Outlet Holdings, Inc. OLLI 0.00%↑ :
OLLI has benefited from a multi-year secular uptrend and is now extending its rally to new all-time highs. These levels have been achieved following a recent breakout above resistance near $120, and OLLI appears poised to build on this momentum in the intermediate term.
Momentum has accelerated as a result of the breakout, suggesting that the upmove can be sustained. Relative to the SPX, OLLI continues to exhibit a long-term trend of outperformance. The recent breakout is mirrored in the relative strength ratio, where a short-term rally is working toward a higher high, reinforcing the longer-term trend.
A measured move target of ~$147 can be derived for OLLI using a Fibonacci extension, projecting the width of the recent range higher. A stop-loss level can be placed near the recent gap up point around $122, below which the breakout would look false.
Chart & Levels
Ollie’s Bargain Outlet Holdings, Inc. OLLI 0.00%↑: Weekly Bar Chart + 10- & 40-week Moving Averages + Cloud Model + MACD Indicator w/Histogram + Ratio vs. SPX
Upside Target: $147
Stop-Loss*: $122
* Our stop-loss discipline requires two consecutive daily closes above/below the indicated level, unless stated otherwise.
Updates on Existing Ideas
We tightened our stop-loss in NVST to $18.25 from $16.60.
Open Ideas from Past Posts
