H&R BLOCK INC is setting up nicely for a breakout.

H&R BLOCK INC (NYSE:HRB) 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:HRB.

Zooming in on the technicals.

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.

We assign a technical rating of 8 out of 10 to HRB. In the last year, HRB 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, HRB did better than 98% of all other stocks. We also observe that the gains produced by HRB over the past year are nicely spread over this period.
• HRB is one of the better performing stocks in the Diversified Consumer Services industry, it outperforms 98% of 70 stocks in the same industry.
• HRB is currently trading in the upper part of its 52 week range, while the S&P500 Index is trading in the lower part of its yearly range. So HRB is doing quite good in this market.

Why is NYSE:HRB a 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:HRB scores a 8 out of 10:

HRB has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. A pullback is taking place, which may present a nice opportunity for an entry. There is very little resistance above the current price. There is a support zone below the current price at 43.81, a Stop Loss order could be placed below this zone. We notice that large players showed an interest for HRB in the last couple of days, which is a good sign.

Trading breakout setups.

One way to play this would be to wait for the actual breakout to happen and buy when the stock breaks out above the current consolidation zone. A possible place for a stop loss would be below this zone.

This article should in no way be interpreted as trading advice. You should always make your own analysis and trade or not trade based on your own observations and style. The article is based purely on some technical observations.

More breakout setups can be found in our Breakout analyzer.