What's Next?!
What I'm about to say may sound a bit unpatriotic but I can only share what I see.
I am talking about one of UK's most successful retailers and one that seems - so far - to have stood it's ground while many of it's peers have teetered or about to do so. I myself enjoy shopping there and more studies ought to be done as to how it managed to stay ahead of the pack.
Being in the camp of "news follows the technical charts", we are yet to see a different story ahead for Next. Above I've shared with you a big picture view of price over the past five years and have stripped away a lot of 'noise' by posting the monthly candles.
After demonstrating an unstoppable upward trajectory forward of 2011 when it busted through the ï¿¡23.33 resistance point, it did not look back until peaking at ï¿¡80 or so toward the tail end of 2015 and has been in a corrective posture ever since.
To me it appears that ï¿¡35.69 is yet to be tagged and possibly also ï¿¡23.33; obviously this will most likely not happen all at once as rarely are moves made in a straight line (up or down) so there will be sufficient opportunities to trade this both ways even if one holds an overall short position in Next. (One can do that with options, having two accounts, trimming some of the position and then adding or a mixture of the above.)
What happens at either of these two price points (35.69 and 23.33) - that is, the structure of the move lower - will allow for further analysis as to whether the pull-back has ended and the run to new highs is afoot or whether something else is going on.
This mid-term trajectory lower is also evident to me when drilling down to a shorter time frame. It is still possible that the ï¿¡60 handle will be re-visited in the short term (price as of this writing is at ï¿¡55.52) and if that happens I would be inclined to short the stock; at this moment it is unclear what the short term direction is though longer term, it is down and quite biggly.
This is a real shame as it's a great shop both in terms of quality and shopping experience and I will happily like to prove myself wrong with this call.
Happy Trading!!!