Will AZEK CO INC/THE breakout?

Our stock screener has spotted AZEK CO INC/THE (NYSE:AZEK) as a possible breakout candidate. A technical breakout setup pattern occurs when the stock is consolidating after a nice uptrend. Whether the actual breakout occurs remains to be seen of course, but it may be interesting to keep an eye on NYSE:AZEK.

Technical Analysis Observations

ChartMill assigns a proprietary Technical Rating to each stock. The score is computed daily by evaluating various technical indicators and properties. The score ranges from 0 to 10.

Taking everything into account, AZEK scores 8 out of 10 in our technical rating. In the last year, AZEK was one of the better performers, but we do observe some doubts in the very recent evolution.

• The short term is neutral, but the long term trend is still positive. Not much to worry about for now.
• Looking at the yearly performance, AZEK did better than 93% of all other stocks. On top of that, AZEK also shows a nice and consistent pattern of rising prices.
• AZEK is part of the Building Products industry. There are 43 other stocks in this industry. AZEK outperforms 90% of them.
• AZEK is currently trading in the upper part of its 52 week range. The S&P500 Index however is currently trading near a new high, so AZEK is lagging the market slightly.
• In the last month AZEK has a been trading in the 42.50 - 48.52 range, which is quite wide. It is currently trading near the high of this range.
• Prices have been consolidating recently, this may present a good entry opportunity.

Check the latest full technical report of AZEK for a complete technical analysis.

Looking at the Setup

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the extent of consolidation in the stock based on multiple short-term technical indicators. Currently, NYSE:AZEK has a 9 as its setup rating:

AZEK has an excellent technical rating and also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a resistance zone just above the current price starting at 49.38. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 46.40, a Stop Loss order could be placed below this zone. We notice that large players showed an interest for AZEK in the last couple of days, which is a good sign.

How can NYSE:AZEK be traded?

A breakout opportunity may arise when the stock surpasses the current consolidation zone and reaches new highs. Traders often wait for this breakout before considering buying the stock. To manage risk, a stop loss order could be placed below the consolidation zone to limit potential losses.

Of course, there are many ways to trade or not trade NYSE:AZEK and this article should in no way be interpreted as trading advice. The article is purely based on an automated technical analysis and just points out the technical observations. Always make your own analysis and trade at your own responsibility.

Every day, new breakout setups can be found on ChartMill in our Breakout screener.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.