On a day where 495 stocks in the SIA S&P 500 Index Report posted declines, discount retailer Dollar Tree fell the most down the rankings, dropping 105 spots to 286th place. The stock’s struggles actually played out over three days, dropping from the green zone on Wednesday, to the yellow zone on Thursday, to the Red Unfavored Zone on Friday. In the last month, DLTR has plunged 281 positions in the relative strength rankings.
Dollar Tree (DLTR) shares staged a major breakdown last week, plunging off a cliff on high volume, indicating a dramatic negative turn in sentiment that sent investors running for the exits. Sparked by management cutting guidance for this year, the shares gapped down on Thursday, breaking $160.00, taking out their 50-day moving average and snapping an uptrend line. The start of a new downtrend was confirmed on Friday by a big Bearish Engulfing candle as the selloff continued below $140.00.
Potential downside support tests on trend appear at a previous low near $130.00, then an old gap between $115.00 and $122.50. Initial rebound resistance appears at Thursday’s doji close near $145.00, then the $150.00 round number.
Dollar Tree (DLTR) shares turned decisively downward last week. The shares had been consolidating after failing to cross through $175.00 for a second time back in July, but recently a downtrend has commenced in earnest. A bearish Double Bottom breakdown has been confirmed by a bearish Spread Double Bottom breakdown the has extended into a bearish Low Pole.
Based on previous column lows, next potential downside support on trend appears near $135.75, then $131.80 and $126.65. Initial rebound resistance appears near $145.55 based on a 3-box reversal.
With its SMAX score falling to a bearish 5, DLTR is exhibiting weakness against the asset classes.
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