SIA Chartsā Relative Strength rankings not only help investors identify which stocks in a universe are outperforming and underperforming against their peers, but also when relative performance trends are changing. FirstService (FSV.TO) shares have slowly but steadily moved down the rankings in the SIA S&P/TSX 60 Index Report. They exited the red zone in March 2023 and climbed toward the top of the Yellow Neutral Zone, where they remained for the rest of 2023 and April 2024 (as circled). However, they were unable to enter the Favored Green Zone and faced resistance, falling back into the Unfavored Red Zone, currently holding 41st place. Although not a top relative performer, shares of FSV.TO have posted a return of almost 25% ($180 to $225) during its recovery rally starting in March 2023. Trading between the support zone around the $200 whole number and current resistance at $234.29, there appears potential for another rally. However, declining relative strength and low volume conviction suggest a lack of momentum for a significant push. If the relative strength continues to decline and with a powerful short-term ADX technical signal, it might be an opportune time to move away from FSV.TO and into Favored Green names at the top of the SIA S&P/TSX 60 Index Report. Long-term resistance is anticipated around $250.00, with support closer to the $200.00 level.
Looking at the P&F chart provides a clearer visualization of the channels and support/resistance lines. Following a major selloff in the first half of 2022, FirstService (FSV.TO) consolidated in a symmetrical triangle of higher lows and lower highs throughout the second half of 2022. In March 2023, FSV.TO broke out to the upside, completing a bullish Spread Double Top pattern and signaling the beginning of a new uptrend in both price and relative strength (though still in the Yellow zone).
The recovery rally from the 2022 lows continued, but the share price failed to surpass the 2021 resistance highs of $253.61. With minor resistance at $234.29, more significant resistance lies near the previous peak around the $250.00 mark. A close above $254.30 would confirm an advance into new territory, with potential resistance thereafter near $269 based on horizontal counting. Initial support is around $208.05 based on a 3-box reversal, followed by $192.20, $184.74, and finally $157.67 & $142.81 in a correction scenario. With an SMAX score (a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of 9 out of 10, FSV.TO is showing short-term strength across various asset classes.
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