With other retailers reporting a tightening of consumer spending and rising energy and housing costs beginning to bite Ulta is demonstrating a megaphone top and approaching trendline resistance.
Trading on a PE Of 22 for a retail operation all off the good news may already be priced in and any slip on earnings will see it severely punished.
Watch for a reaction...
The function of bear markets is to remove all speculative excess from markets and individual stocks.
My last publication was on BNPL stock ZIP on the Australian ASX which suggested that it would go bust and is now trading at 45 cents from $14.50.
The next speculative sector is Lithium Mining which has been supported by a great deal of irrational exuberance...
As typical with bear markets the unprofitable "growth stocks go first, followed by the profitable stocks on high multiples and the overall index is saved by the large caps due to their weighting in the index.
The FAANG index has now broken down and is looking at a minimum 34 percent loss.
The index decline will be accentuated by further losses in the first two...
It appears that Bonds failed and reversed at a exact 0.618 extension of the bull run since 2008 and reversed sharply which is characteristic of a truncated C Wave suggesting we are headed much lower in prices and consequently much higher in yields. (Possibly all the way back to 2008 origination.)
Note I have labelled this as an ABC move and not an impulsive move...
Australia the one time frenzy centre of BNPL has more than 13 companies listed in the sector. Once market darlings but without exception loss-making were driven by sentiment to un realistic highs.
Now they all appear to be in terminal downtrend with very muted counter trend rallies.
Zip being a case in point is unable to break out of its downtrend and targets...
