PVH Corp. operates as an apparel company in the United States and internationally. The company operates through six segments: Calvin Klein North America, Calvin Klein International, Tommy Hilfiger North America, Tommy Hilfiger International, Heritage Brands Wholesale, and Heritage Brands Retail. It designs, markets, and retails men’s and women’s apparel and accessories, branded dress shirts, neckwear, sportswear, jeans wear, intimate apparel, swim products, handbags, footwear, golf apparel, fragrances, cosmetics, eyewear, hosiery, socks, jewelry, watches, outerwear, small leather goods, and home furnishings, as well as other related products.
Take a look at the 1-year chart of PVH (NYSE: PVH) below with added notations:
PVH had been trading sideways for the past several weeks. During that period of time, the stock formed a clear resistance level at $110 (green) and a strong level of support at $105 (blue). At some point the stock had to break one of the two levels created by the rectangle pattern, and earlier this week the stock broke resistance.
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The Tale of the Tape:: PVH had a level of resistance at $110, the stock broke that resistance, and now that level should act as support. The ideal long opportunity would be at or near that $110 level. On the other hand, one could enter a short position on a break back below that level.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT
Follow me on Twitter: @cmtstockcoach