CHEWY INC - CLASS A is showing promising signs of setting up for a breakout.

Our stock screener has detected a potential breakout setup on CHEWY INC - CLASS A (NYSE:CHWY). This breakout pattern is observed when a stock consolidates following a strong upward movement. It's important to note that this pattern is based on technical analysis, and the actual breakout outcome is uncertain. However, it might be worth keeping an eye on NYSE:CHWY.

Insights from Technical Analysis

Every day, ChartMill assigns a Technical Rating to each stock, providing a score ranging from 0 to 10. This rating is determined by evaluating various technical indicators and properties.

Taking everything into account, CHWY scores 10 out of 10 in our technical rating. This is due to a consistent performance in both the short and longer term time frames. Also compared to the overall market, CHWY is showing a nice and steady performance.

• Both the short term and long term trends are positive. This is a very positive sign.
• When comparing the yearly performance of all stocks, we notice that CHWY is one of the better performing stocks in the market, outperforming 95% of all stocks. On top of that, CHWY also shows a nice and consistent pattern of rising prices.
• CHWY is part of the Specialty Retail industry. There are 120 other stocks in this industry. CHWY outperforms 93% of them.
• CHWY is currently trading near its 52 week high, which is a good sign. The S&P500 Index however is also trading near new highs, which makes the performance in line with the market.
• In the last month CHWY has a been trading in the 35.73 - 40.09 range, which is quite wide. It is currently trading in the middle of this range, so some resistance may be found above.

For an up to date full technical analysis you can check the technical report of CHWY

Why is NYSE:CHWY a setup?

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

Besides having an excellent technical rating, CHWY also presents a decent setup pattern. Prices have been consolidating lately. A pullback is taking place, which may present a nice opportunity for an entry. There is a resistance zone just above the current price starting at 39.28. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 37.54, a Stop Loss order could be placed below this zone. We notice that large players showed an interest for CHWY in the last couple of days, which is a good sign.

How can NYSE:CHWY be traded?

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.

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

Disclaimer

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.