Lululemon Athletica ended last year by climbing to new record highs. Now it’s pulled back, and may draw attention from dip buyers.
The first pattern on today’s chart is the December 8 breakout after earnings and revenue beat estimates. LULU has given back most of the gains and revisited the pre-earnings closing high. Will old resistance become new support?
Second, the retailer formed a hammer candlestick around the same level. That may suggest buyers are stepping in.
Next, the current price area has potential confluence with the 50-day simple moving average.
Fourth, stochastics have dipped to an oversold condition.
LULU may need to stabilize for a few sessions given its drop since December. If the current price zone holds, longer-term trend followers may look for a continued move to all-time highs.
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