Tuesday, September 20, 2011

TJX Watch

When a 20-day Donchian price channel breakout is combined with a long-running range breakout, it's reasonable to assume that there's some real push behind the price movement.

TJX Companies Inc. (TJX) -- that's T.J. Maxx and Marshall's to the bargain-hunting crowd -- fits that model, with an 8.6% rise in two days culminating an uptrend from Sept. 12 that carried the price up 17%.

sym phase trend adx   200/50 40/10

The breakout blew past the Donchian channel boundary at $56.56, and also broke past the $56.56-$56.78 that had formed the upper boundary of price movement since Aug. 1.

Analyst sentiment is somewhat bullish, and the fundamentals back that up, with a debt/equity ratio of 0.25, return on equity of 43, and institutional ownership at 92%.

A caveat: After the breakout bar, daily volume declined each of the next two days as the price rose. And although the momentum shows on the half-hour chart, where a strong uptrend developed from Monday's open, the price has began to retrace from noon today Eastern.

All of which suggests TJX may no longer be such a bargain, if ever it was.


  • phase: 20-day price channel phase, with green for bull trend, red for bear trend and yellow for neutral trend.
  • trend: Price direction, green for higher highs and higher lows, red for lower highs and lower lows, yellow for neither.
  • adx: Average directional index location, indicating the strength, or the temperature, of the trend. Orange for 40 or greater, aqua (light blue) for 25 and up but below 40, magenta (light purple) for 20 and up but below 25, and brown for anything below 20. (Mnemonic: Orange for the overhead sun, blue for the surrounding sky, magenta for sunset on the horizon and brown for the earth.)
  • 200/50: The moving average cross, green for the 50-day ma above the 200, red for below and yellow for closely aligned.
  • 40/10: The moving average cross, green for the 10-day ma above the 40, red for below and yellow for closely aligned.

About my trading methods

Read a detailed explanation of my analysis method, including trading rules.


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

The trader’s greatest sin is inaction. Sleeper, awake! Seize the Nietzchean moment. Roll out of bed and trade.

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