Market Update: Retail Stocks Are Hanging Tough

Michele Schneider

The malls were high risk before COVID-19, given the number of bankruptcies of chain stores such as Pier One and Toy R Us. 

Online shopping generated malls to become like ghost towns.

Now with COVID-19, one would expect the high risk to go to full on death and destruction. 

Just this week Ann Taylor and Brooks Brothers, two mall staples, filed for bankruptcy.

And who is going to the malls now given social distancing?

Well that’s the rub.

It is possible that after sitting on our butts and moving nothing more than our hands over the keyboard to shop for the last several months, malls could make a comeback.

retail consumer shopper_financial markets image

And why do I say such a crazy thing?

Just look at our sweet little Granny Retail, donned in a leisure suit, just itching to take some mall laps and use her credit card.

After all, is that not the American Economic Modern Family’s matriarch?

Please click the link below to see more analysis on brick and mortar retail, plus get key levels for the equity indices, and actionable trading ideas in sector ETFs.

On the weekly chart, the Retail Sector ETF (XRT) is above the 200-week moving average, while her husband, Russell 2000 (IWM) is not.

xrt retail sector etf rally higher price analysis chart investing image july 9

The 10-DMA is starting to accelerate and just crossed over the 50-WMA (blue line).

The Retail Sector (XRT) is in a weekly accumulation phase. Let that soak in.

Furthermore, it is well outperforming our benchmark.

And finally, our Real Motion indicator shows momentum has gained.

If XRT can clear the Bollinger Band on RM as well as the 45.00 level in price on a weekly close, Gramps IWM and Transportation IYT, are likely to follow.

And that my friends, is the number 1 hope to see for the market and the economy.

A consumer-based recovery will have me running around the malls as well, only with a mask on!

I’ve been busy lately, talking about Granny, Financial sector and commodities lately. Here are this week’s links thus far.  FACE Interview July 8th 2020-Gold: We took partial profits in PM’s after this run higher.

Trader Rundown 07-07-20 Angela Miles   Ameritrade Network-Market Overtime July 7,2020

S&P 500 (SPY) 318.22 is a gap that must fill. 315 pivotal 310 support

Russell 2000 (IWM) 141 then 137 support 146.25 resistance

Dow (DIA) 257 support 262.50 resistance 

Nasdaq (QQQ) Inverted hammer doji yesterday-inside day today. 

KRE (Regional Banks) Hinging on support 

SMH (Semiconductors) 155 support-160 target

IYT (Transportation) 161.50 pivotal support 170 resistance 

IBB (Biotechnology) 137.60 closest support

XRT (Retail) 43.40 huge support 45 resistance 

Volatility Index (VXX) 32.70 pivotal 

Junk Bonds (JNK) 104.50 resistance 101.50 support 

LQD (iShs iBoxx High yield Bonds) 134.90 support

Twitter: @marketminute

The author may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.