Ralph Lauren Corporation designs, markets, and distributes lifestyle products worldwide. The company operates in three segments: North America, Europe, and Asia. It offers apparel, including a range of men’s, women’s, and children’s clothing; accessories, which comprise footwear, eyewear, watches, fine jewelry, hats, belts, and leather goods, such as handbags and luggage; home products consisting of bedding and bath products, furniture, fabrics and wallpapers, lightings, paints, tabletops, and giftware; and fragrances.
Take a look at the 1-year chart of Ralph (NYSE: RL) below with the added notations:
RL got hit pretty hard from winter 2016 thru spring 2017. Since the May bottom, the stock has slowly climbed higher. RL hit resistance at $75 both this week and earlier in July, and that same level provided support way back in February. A break above the $75 level seems to be key in RL taking another leg higher.
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The Tale of the Tape: RL has a key level at $75. Traders could enter a long position on a break above $75, with a stop placed below that level. Traders that are bearish on the stock may want to enter a short position on a test of that level instead.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT