LuluLemon LULU Squeezes its way Between the Daily EMAs

Aug 21, 2017: 2:41 PM CST

Shares of Lululemon (LULU) jumped today, but merely continued the “ping-pong” between the 20 and 50 day EMA price pivots.

It also held a key support level from our Fibonacci Grid.  What’s going on?  Let’s see it:

Lululemon LULU

Shares plunged in 2017 from $70.00 beneath $50.00 but have since recovered.

Strangely enough, shares sit right at the 50% retracement (recovery) of the 2017 decline.

It’s a key level that we’ll use for our future swing/short-term trading.

Simply stated, price is playing bouncy-bounce (ping-pong) between the falling 20 and rising 50 day Exponential Moving Averages (EMAs).

We won’t take a trade until price BREAKS OUT of this yellow zone between the EMAs.

When it does, use it as your trigger to trade the “Departure” from this squeezed level.

A breakout beyond $60.00 then $62.00 suggest a recapturing of the bull market in motion.

Otherwise, a firm breakdown beneath $58.00 suggests we just saw a Dead Cat Bounce and may easily see shares tumble lower toward $52.00 or even lower than that.

Plan and trade accordingly.

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Corey Rosenbloom, CMT

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