ULTA extended the decline off the record high at 75.69 (07 Nov) to test the 3-month rising wedge support line (from 48.28/51.64/64.03 lows) which held. However, the bearish RSI divergence (comparing 74.00/75.69 highs) suggests further downside. A downside break of 67.76 near the rising trendline support is required to confirm the top in place and allow bears to target 64.03 (Support 1). Clearance below would risk an extension towards 58.71 (Support 2) ahead of 51.64 (Support 3).
It would take strength above 71.71 (Resistance 1) to delay bears. However, only above 74.38 (Resistance 2) would negate and shift focus higher towards 75.69 (Resistance 3) for a retest.
Trading Indication:
Short-term: Sell at 70.80 or higher;
Target at 58.71 and lower;
Stop Loss at 71.75 (1.3%)
Long-term: Possibly buy lower
It would take strength above 71.71 (Resistance 1) to delay bears. However, only above 74.38 (Resistance 2) would negate and shift focus higher towards 75.69 (Resistance 3) for a retest.
Trading Indication:
Short-term: Sell at 70.80 or higher;
Target at 58.71 and lower;
Stop Loss at 71.75 (1.3%)
Long-term: Possibly buy lower
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