Fairlead Strategies Idea Generator
The Home Depot, Inc. (HD) & Updates (MSA, TM, RC, SQM)
We are removing MSA Safety (MSA) and Toyota (TM) from our long ideas because they have surpassed our targeted resistance levels. We are also removing Ready Capital (RC), which has minor signs of upside exhaustion near targeted resistance.
Short idea Sociedad Quimica y Minera de Chile SA (SQM) would stop out with a close above its 50-day moving average (~$71) today.
With the consumer discretionary sector well-positioned relative to the S&P 500 Index (SPX), we are adding The Home Depot, Inc. (HD) to our long ideas:
HD appears to be emerging from a six-month corrective phase, noting intermediate-term momentum has shifted higher per the weekly MACD and the 50-day (~10 week) moving average. This makes a breakout above the 200-day (~40-week) moving average likely
A breakout would support upside follow-through especially with overbought conditions not yet present. Relative to the SPX, HD is showing intermediate-term signs of downside exhaustion per the DeMARK Indicators®. This supports a rebound in relative performance following an extended phase of underperformance.
Targeted resistance for HD is well-defined by the weekly cloud model and a 50% Fibonacci retracement level, which align near $343. A stop-loss can be placed below trendline support (~$280) for risk management.
The Home Depot, Inc. (HD, $301.12)
Target: $343
Stop-Loss: $280
Please note this is a free post, so we do not include the table of open ideas, but we will in our next post for paid subscribers.
From a technical perspective only - we featured it today in our research, feel free to request a copy or sign up for a trial @ www.fairleadstrategies.com.