The daily dip is extra painful considering the rally we’re seeing in the broader market.
Rite Aid is off the session low, where it was down almost 11.5%. Still, it hasn’t been an easy ride for the stock.
The shares are down almost 20% for the week, and even before Thursday's spill, Rite Aid was down over 12% this week.
Additionally, the shares have now fallen in 11 of the past 14 sessions. Rite Aid is down 26.5% from this month’s high.
Enough with the statistics; Investors want to know if this name is a buy.
While Rite Aid enjoyed a few meme-inspired rallies this year, it’s not doing well. That said, it’s holding up over one key level. Let's take a close look.
Trading Rite Aid Stock
“A close below $16.63 and we have some problems.” That’s what I wrote a few months ago on Rite Aid’s previous post-earnings pullback.
That turned out accurate, with the shares later bottoming at $13.22 and hammering out a low in the $13.20 to $13.50 zone over the next three days.
With Thursday’s post-earnings pullback, the shares are now finding support in this area once again. The stock bottomed at $13.52 on the day and bounced back over $14.
Now the prior low — the one at $13.22 — becomes a main focus. In short, the bulls need to see Rite Aid stay above this level.
Last quarter, Rite Aid stock began to roll over ahead of earnings, falling in seven of the nine sessions ahead of the report. Then it gapped lower.
We have the same price action now, only we’re falling from a lower high. Now, we’ll have to see whether Rite Aid bulls can defend the lows; otherwise, we could see the $10 to $12 area in play next.
On the upside, let’s see if Rite Aid can fill the gap up toward $14.90. Above that puts its 10-day and 50-day moving averages in play. Above those measures and it’s possible that the stock fills the $17.30 gap.
This one is pretty simple: Watch $13.22. Below that level does not bode well for the bull case.