Trade Ideas Newsletter 08/02/2016

ULTA is at the start of a significant breakout

Based on the preceding analysis in ULTA, traders should determine that their account can handle increased risk from a new position. Also be sure that ULTA is not too correlated with your existing position. Lastly, excellent traders always check how a new addition relates to not just their overall account, but the prevailing market action as well. For example, check the S&P 500. Is it trending up or down recently? Has it recently exceeded key resistance or support levels? Be sure to align your trading actions on ULTA with the overall market so you are not swimming against the tide.

CHART

Currently the calculated sentiment levels, evaluated by Traders For Wealth, have shown an increasingly positive bias toward ULTA. Also, the price action in ULTA has been moving on up. This is a strong sign for a potential upside breakout. Traders should view this as a bullish trade and make sure it aligns with the overall market mood, and their current positions.

Ulta Cosmetics & Fragrance (ULTA)

Ulta Salon, Cosmetics & Fragrance, Inc. is a beauty retailer. The Company operates specialty retail stores selling cosmetics, fragrance, haircare and skincare products, and related accessories and services. The Company operates through three segments: retail stores, salon services and e-commerce. The Company also offers a full-service salon in every store featuring hair, skin and brow services. The Company offers approximately 20,000 products from over 500 beauty brands across all categories and price points, including its own private label, the Ulta Beauty Collection. The Company operates over 870 stores in approximately 50 states. The Company offers a loyalty program, Ultamate Rewards, and targeted promotions through its Customer Relationship Management (CRM) platform. It also offers promotions and coupons, in-store events and gifts with purchase. The Company’s e-commerce business, Ulta.com, provides access to product and store information, beauty trends and techniques.