Market Cycles Suggest Abercrombie Setting Up To Pop And Drop ByThe End Of Q1

Summary:

• Abercrombie & Fitch Co. ANF has traded over 3 percent higher since Wedbush raised its price target on December 28.
• Our view is that the stock will continue higher only to fail in its intermediate resistance zone.

Wedbush Securities raised its price target for Abercrombie & Fitch from $17 to $19. However, the stock analyst was a day late, as the shares closed at $19.28 on the previous trading day.

In analyzing the market cycles for ANF, the present rising phase is substandard, with a high, so far, only in the first week off its recent low. Yet we believe it will continue to move higher before failing in the resistance zone between $21.70 and $22.50.

After that, we see the stock declining again, testing the $15 level by March of 2019. The megaphone suggests that the stock is trying to make a longer-term bottom.

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