Will BJ'S WHOLESALE CLUB HOLDINGS breakout?

BJ'S WHOLESALE CLUB HOLDINGS (NYSE:BJ) was identified as a Technical Breakout Setup Pattern by our stockscreener. Such a pattern occurs when we see a pause in a strong uptrend: after a strong rise the stock is consolidating a bit and at some point the trend may be continued. Whether this actually happens can not be predicted of course, but it may be a good idea to keep and eye on NYSE:BJ.

What is the technical picture of NYSE:BJ telling us.

ChartMill assigns a Technical Rating to every stock. This score ranges from 0 to 10 and is updated daily. The score is determined by evaluating multiple technical indicators and properties.

Overall BJ gets a technical rating of 10 out of 10. This is due to a consistent performance in both the short and longer term time frames. Also compared to the overall market, BJ is showing a nice and steady performance.

• Both the short term and long term trends are positive. This is a very positive sign.
• Looking at the yearly performance, BJ did better than 95% of all other stocks. We also observe that the gains produced by BJ over the past year are nicely spread over this period.
• BJ is one of the better performing stocks in the Food & Staples Retailing industry, it outperforms 86% of 46 stocks in the same industry.
• BJ is currently trading in the upper part of its 52 week range. The market is still in the middle of its 52 week range, so BJ slightly outperforms the market at the moment.
• BJ is currently showing a bull flag pattern! A bull flag pattern occurs when prices pull back slightly after a strong rise up. This may be a nice opportunity for an entry.

Looking at the Setup

ChartMill also assign a Setup Rating to every stock. With this score it is determined to what extend the stock has been trading in a range in the recent days and weeks. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. NYSE:BJ scores a 9 out of 10:

BJ has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a resistance zone just above the current price starting at 69.61. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 68.82, a Stop Loss order could be placed below this zone. Another positive sign is the recent Pocket Pivot signal.

How to trade NYSE:BJ?

For a potential trade one would typically wait until the stock breaks out of the consolidation zone to enter the stock and it could be sold again for a loss when it would fall back below the zone.

Of course, there are many ways to trade or not trade NYSE:BJ 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 analyzer.