Bearish Bets: Price Targets for 3 Stocks Headed Lower
These names all broke hard recently and the selling is likely not over.
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Let's check three stocks that appear technically bearish and look ready to short.
While we will not weigh in with fundamental analysis on these issues, we will pop the hood for a look at the charts.
Let's dig in.
1. Bulls Should Not Get Comfortable in a La Z Boy
La Z Boy LZB, the furniture/recliner company, has fallen on hard times. The stock was blistered this week on heavy volume, swelling after a big earnings miss and guidance that also missed the target. Technicals have turned bearish, the stock has fallen through the downtrend channel and is looking for lower prices. When a big volume event happens to the downside there is often more selling that hits the stock later.
We can capture some of that downside by being patient with a new short play on LZB. Let's target the $27 area here for starters, this is likely to go even lower on the next wave of selling. Put in a stop at $36 just in case, but with the heavy down move that won't likely come into play.
2. Gildan Activewear Looks Ready to Break Lower
One bad day for Gildan GIL does not make a trend, but certainly if it is ready to falter now would be the time. Heavy volume on the downside this week could be the trigger here, and with the indicators rolling over and weakness in the stock market there is rationale here. The interesting level is $46, where the stock fell to earlier this month and bounced back sharply.
That is where we think the stock could go for starters, and then lower to about $40 or so. MACD is still on a bull signal but not for much longer, money flow has turned bearish and RSI was stymied at the recent highs. All in all, this stock needs buyers and after Wednesday's selloff they seem to be absent.
3. Target Misses the Mark One More Time
This stock has been one of the worst performers for years. Target TGT is a repeat offender in this column and for good reason, there are plenty of shorting opportunities with this retailer. Recent earnings were a huge disappointment and while the stock has been down hard for the year, sellers still hit this one hard.
MACD has rolled over again, money flow and on balance volume remain challenged, RSI is making lower highs. Nothing positive for indicators and the price chart is still bearish. We expect this to roll over and eventually approach the $80 level, and eventually down to $72. Let's use a stop at $104 just in case.
