March 13 Chart of the Day - Ulta Beauty
Precision oriented price action technical analysis by far provides the best edges and most setups for traders and investors across the markets so that's what we use for the basis of our reviews
Ulta Beauty (ULTA) is set to report earnings after the market closes today. Investors are anxiously watching as the stock hovers at a critical long-term support level, with the risk of a possible breakdown looming.
Consistent profitable investing and/or trading requires a structured, rules-based approach to price action analysis. Proven processes, disciplined risk-reward management, and precise execution create the foundation for long-term success.
When combined with powerful mental performance strategies, this method becomes the ultimate blueprint for thriving in any market, on any time frame.
In this analysis, we’ll take a price action technical approach to evaluate key levels and potential next moves in the stock.
We have featured over 450+ Charts of the Day since May 2023 and teach Price Action Trading for FREE to traders who join our Highly Rated Trade Room.
Monthly Chart
On the monthly chart we can see that after setting its $574.76 all time highs (ATHs) about a year ago price fell in dramatic fashion.
With little to no previous price history at ATHs price can go through what we like to call a "discovery phase" to create new structure.
In this scenario, price seemingly sped through the discovery phase (for now) and quickly faded back down towards previous and familiar price structure bypassing previous support/resistant levels.
Price is quickly approaching a long term previous support level in the $320 area and essentially is searching for a bottom.
All very normal price action movement but very unpopular with investors.
Weekly Chart
On the weekly chart we can see where price set its ATH before quickly dropping back down the past several months.
Why then when a company makes ATHs can price quickly drop back down?
For a variety of reasons including maybe this was a case of traders and investors taking some profits off the table.
Regardless, it's clear to see that for more than five years price has been making a series of higher highs and higher lows /aka/ an uptrend but that could soon be in jeopardy of breaking.
It goes without saying though, the only guarantee in the markets is that price cycles. It cycles up and it cycles down across all time frames and all charts and rarely, if ever, moves in a straight line.
Only time will tell for sure what price will do next...
We've layered in traditional Fibonacci levels as well as support/resistance and trend to help identify potential price levels of interest and/or future price targets.
Armed with precision oriented charts like these both traders and investors can formulate their respective plans.
So what's next?
We don't make predictions...
Nobody knows for sure but using these 5 price action tools traders and investors can develop levels of interest in both directions.
- Support/Resistance
- Trend
- Fibonacci
- Supply/Demand Zones
- Change Control Zones
ChartPros provides the exact methodology in its price action technical analysis courses to create charts like this with the most precise and accurate levels from which investors and traders can formulate their respective trade plans.
Take a look at the charts and let us know what you think. We'd like to hear from you in the comments sections.
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