Lululemon Athletica Inc. (LULU) just recently gapped up on earnings breaking through a daily downtrend line and challenging its previous downtrend.
Gap Review
On September 11, 2014, LULU gapped up taking out the $43.70 pivot high of supply. The $43.70 has become a new demand potentially establishing a transition from a downtrend to an uptrend. On the gap day LULU traded over 28 million shares versus a daily average of 1.6 million showing us that institutions were in play on this stock in the gap day.
Key Level
LULU has created a key level of demand at $43.70. If LULU can clear over the gap day high area of $45.60 if could be off to the races in hunt for new highs.
The Trade
Long over $45.60, Stop at $42.50 and Target into $57.00
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