$TH – PENDING: Buy C&H Breakout


    • In defined Stage 2
    • Base 2 Cup and Handle
    • Formed a well-structured long ~5-month cup
    • Currently finishing the handle moving back up towards the turn
    • The turn is at $16.73
    • Very strong RS relative to sector, but sector is weak relative to SPX
    • The previous quarter showed breakout EPS and margins
    • This quarter showed more YoY growth, but QoQ contraction
    • Fundamentals are a concern. They could be more consistent. Good breakout, but not very good follow through or acceleration. My other concern is with the RS. It is very strong compared to the Consumer Discretionary sector, but that sector is weak relative to the SPX. It still needs to make a good move to break over the turn, but I will place an order to buy there.

Stage Analysis

There was some huge stopping volume to stop the Stage 4 decline. That started Stage 1 which lasted about a year on little volume. Finally, exploding into its current Stage 2.

Base Count

After Base 1, it made a huge 183% move up in just under a month. Those big gains had to be digested, which resulted in the Base 2 cup and handle.


Looks like it formed a solid cup and handle that lasted about 119 days. It’s currently coming up off the low of the handle, towards the turn. Very strong 148.15% RS above the CD sector, but sector is 24.1% below the SPX.

Cup Criteria

>= 30% uptrend prior to cup with improving RS and increases in volumeYES, 192% with RS hitting new 52-week high at the time
7 – 65 weeks (typically 3 – 6 months)YES, cup lasted ~4 months
Correction from top to bottom of cup is 12-33%YES, 33.63%
More “U” than “V” bottomYES
Decline < 50%YES, 33.63%
Decline < 2.5X marketYES, market declined more than cup

Handle Criteria

Upper 1/2 of cupYES
Above 50-day MAYES
Price drift down to lower lowYES
>= 1 weekNO, 7 bars
Price range tightYES
Volume dried upYES


Past 2 quarters EPS growth >= 25%NO, past quatre was but most recent quarter was a decline
Past 2 quarters margin growth >=25%NO, past quatre was but most recent quarter was a decline
EPS growth >= 25% in past 3 – 5 yearsYES
EPS surprisesYES, previous quarter was a BO surprise
EPS break outYES, previous quarter
ROE >= 17%NO
Earnings driftYES

Order Details

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