JCP Seasonality 6.27.17

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EOM Technical and Trading:  JCP Seasonality  6.27.17

As promised, the Q2 High-Dividend Fund Report is complete and available in the EOM Members Vault.  I will begin reporting on it tomorrow-Wednesday.

For today’s analysis, I designed a new chart for JC Penny, focusing on seasonality opportunitie$.

Institutions and retail traders have shorted JCP and other retail stocks hard and may lead to additional opportunities.  How? In the last three years, there have been rallies, beginning in mid-summer and running into the fall. 

Some rallies have been linked to (earnings) back-to-school sales. I will add, short-covering can also be a factor.

Key Points…

1.  Top Box-JCP is trading with an inverse correlation -.69 to the SPX

2.  No dividends

3.  Summer to fall runs are highlighted

4.  Current downturn from the December 2016 SS Sell Signal is 55%

Action Points…

1.  If JCP closes over the 6 MA ($4.79) watch for additional (buying) short-covering 

2.  If JCP rallies above $5, it becomes marginable

3.  Marginable means traders can trade additional shares with borrowed funds

4.  Our indicators will give clues to IF a rally will have legs, leading to the possibility of a nice mid-summer to fall run   

5.  Don’t overlook pricing calls if JPC decides to run or puts if a rally fails

Enjoy your day!

David O. England 

Plan your work, work your plan, and share your harvest! 1 Timothy 2:1-2

This information is for Educational purposes only. It shall in no event be construed or interpreted as an offer or recommendation to buy or sell securities of any kind.

DAVID O. ENGLAND is the founder of the Eye on the Market-Training Academy and Associate Professor Emeritus of Finance. This column is presented for educational purposes only and not intended as financial advice.

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