Nordstrom and the Dump Trump Trade (NYSE: JWN)

Nordstrom Inc. ($ JWN)

The trades are settling on Nordstrom ($ JWN) after the Trump tweet criticizing the company for dropping Ivanka’s product line. Last Wednesday, February 8th, Nordstrom bucked the trend of recent President Trump tweets attacking companies and actually closed higher by 4% to $ 44.53. Sears and TJ Maxx soon followed by dumping their Trump inventory and saw a jump in their stock as well. The market reaction in these companies for dumping Trump products are now simply called the “Dump Trump” trade. When news breaks out, the stocks jump. But for how long?

Here’s the 5-day chart of JWN.

Camtrading’s Outlook

Should you buy this stock? Retailers have underperformed the S&P in the last year. Nordstrom is no exception. Compared to the S&P, Nordstrom is underperforming the index by nearly 30%!

The stock benefited from the tweet for a few days but today closed below the close on February 8th. The trades are settling on Nordstrom. Looking at the yearly chart, there is short-term support at the $ 43 level and resistance at the $ 48 level. A dip below the $ 43 support level, then you’re looking at the $ 37 support level. Even though Nordstrom benefited from the Dump Trump trade, the near-term outlook doesn’t look great for the company. The 52-week high was reached in December 2016 and the stock has dropped 29% since. If JWN can hold the support level of $ 43, then maybe the stock may test the $ 48 resistance level.

Performance

  • 52 Week range:  Low of $ 35.01 (May 2016) and the High is $ 62.82 (December 2016)
  • 1 Month performance: +0.3%
  • 1-year performance: -12.8%

Moving Averages 

  • 50-day simple moving average (SMA): $ 48.56
  • 100-day SMA: $ 51.29
  • 200-day SMA: $ 47.54

Disclosure: Performance data is as of the date of this posting. I do not own stock in Nordstrom. This article only expresses my opinion and is not a recommendation of the company. I accept no responsibility for any investment decisions the reader makes. Check out my reports on Frontier Communications, Pepsi, and DryShips. 

The post Nordstrom and the Dump Trump Trade (NYSE: JWN) appeared first on CAMTRADING.

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