AutoZone’s technical analysis
So far in this series, we’ve covered AutoZone’s (AZO) 1Q17 revenues, margins, and valuation multiples. Currently, the company’s valuation multiples are trading lower than peers O’Reilly Automotive (ORLY), and Advance Auto Parts (AAP). Now let’s see what a technical analysis reveals about AutoZone stock.
Could AZO hit an all-time high this month?
As of December 7, 2016, AutoZone stock is trading on a bullish note at $809.47. On July 11, 2016, the stock posted an all-time high of $819.54. Since then, the price has tested this major horizontal resistance level twice.
When the price once again comes close to this key resistance level, it will be backed by underlying strong industry and company fundamentals. AZO’s 14-day RSI (relative strength index), the key momentum indicator, is still hovering at 66.6, just below the overbought territory. That number confirms a positive bias and suggests that the stock could post a new all-time high in the near future.
A breach of its all-time high of $819.54 could attract fresh buying for AutoZone stock.
On the downside, a major horizontal support level lies near $776. Only an early breach of this key support level could negate the above-mentioned possibility and turn sentiments to negative.
Automakers’ November sales
US automakers (XLY), including General Motors (GM) and Ford (F), reported solid November sales earlier this month. That could be driving the recent optimism in auto industry stocks. To find out more, read Decoding Mainstream Automakers’ November US Sales Data.