In late-March 2022, the widely-diversified retail ETF, XRT, hit a closing high of 81.06.
Since that time, it's dropped roughly 25% to close on Tuesday at 60.32. But not all retail stocks have performed poorly. Enter Murphy USA (MUSA), which is up approximately 60% from its March 2022 low (164.10) vs. yesterday's close of 264.81. Volume trends have been quite strong on MUSA and both its relative strength and AD line are soaring:
Enter Murphy USA (MUSA):
We'll likely hear about all the great company news after the bell today as MUSA gets set to report its latest quarterly results. A lot of good news is likely built into its price at this point, so we should potentially be ready for the "sell on news" part of that old Wall Street adage, "buy on rumor, sell on news". There's a reason for MUSA's tremendous run higher in a group that has been lacking a lot of leadership.
What does this mean?
- I fully expect to see MUSA beat Wall Street's consensus estimates for revenues and EPS.
- But patience could be a virtue here as short-term selling to test the rising 20-day EMA could provide a trading opportunity. I wouldn't even rule out a possible trip back to the 240s, given that's where the latest bull wedge breakout occurred.
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Happy Trading!Tom BowleyChief Market StrategistEarningsBeats.comBetter Timing. Better Trades. |