Nordstrom threatens to Breakout ( $JWN )

The Apparel Retailing Sector ( $DJUSRA ) has been in zoom-zoom mode for about the last month. Rather than trying to hop on late to some of the racing apparel names, I went searching for set ups in names within the group that have been lagging. Often times strength within the group will lift these heavier boats within the rising tide.

A name and set up I came across is Nordstrom’s ( $JWN)

The Technicals look Bullish
Here are the key take-aways from the charts.

  • Both the Daily and Weekly price action are in snyc.
  • RSI has broken trend line resistance to the upside in both charts
  • Momentum on the Weekly PPO indicator has been steadily rising for 2 years
  • Both Daily and Weekly momentum on the PPO are above zero line which is bullish
  • ADX indicator just broke above 20 on the Daily Chart indicating that a new trend is emerging.
  • Price on both the Daily and Weekly charts are on the verge of breaking out.

Please refer to the Daily chart on Top and Weekly Chart below for further detail.

The Trade
I want to see price cleanly take out the last bit of resistance before I get long. That will give me a clear line to shoot against and a place to set a stop. I have an alarm set at $53.50.  If reached, I plan to target the Jul 52.50 Calls which are presently priced at $2.38.  My First target is $56. My second Target is the measured move from the recent consolidation which is $59-$60.  JWN’s Earnings have already cleared and they are not scheduled for the next ER announcement until mid August.

With the FED scheduled to come out with their proclamations this afternoon, I wont be adding this or any other positions until that risk, however small, clears.

Good Luck, Hope it Helps!

Chris

If you have a stock or other idea you’d like me to cover, please shoot me a note at [email protected]  

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