Macy’s stock just snapped back to a historically bullish trend line
The actions of department stores concern Macy’s Inc (NYSE:M) hasn’t seen the same dramatic drop that many stocks have seen over the past two weeks, although the safety has been sitting between the $22 and $28 levels since a sharp pullback from its three-year high at the end of november. Although the stock was bumped into the lower end of this channel earlier in the week, the pullback has brought M back close to a historically bullish trendline that could provide tailwinds in the month ahead.
To be more specific, Macy’s stock just came within one standard deviation of its 200-day moving average after a long stretch above the trendline. According to data from Schaeffer’s senior quantitative analyst, Rocky White, M has seen two similar signals over the past three years, posting positive one-month returns after both signals and averaging 6.5% over the past three years. this period. From its current perch, a similar move would put equity at $26.07 and closer to a breakout on the charts.
Despite its 44% year-over-year lead, analysts are still hesitant, which could lead to bullish ratings down the road. Of the nine covers, only three consider M a “strong buy”, while four say “hold” and two say “sell” or worse.
An unwinding of short interest could also propel Macy’s stock higher. Over the past two reporting periods, short-term interest has increased by 7.9% and now represents 11.1% of the share’s free float.