The big retailers are set to reveal numbers and it will tell a lot about how consumers are feeling and spending. Today Home Depot (HD) is set to pull back the curtain on the last quarter so lets see what clues the chart gives us about what to expect. We have talked about what to look for on charts to get a sense of what impact earnings will have on the stock price. You can check that out here.

Home Depot is right at it’s high for this year but has leveled a bit recently. With higher interest rates and the housing market still tight, people are putting more resources into renovations. You can see on this chart there was a test of the 10 day moving average in the recent week.

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With the MACD elevated and the sideways move creating the start of a bearish crossover, you get the sense earnings are going to be flat or under expectations. The forces driving people to work on their existing homes may be a factor to defy the chart.

Earning seasons are a bit like the wild west where traditional charting rules can get broken and crazy things can happen. Use smart strategies if you decide to trade these stocks. Keep positions moderate to small and be ready to cut losses quickly if a trade turns against you.

Keep learning and trade wisely,

John Boyer


Market Wealth Daily