How to Adjust Positions in Retailers Dillard’s, Nordstrom, Macy’s

NEW YORK (TheStreet) -- Tepid consumer spending and weaker confidence in the first quarter created share price weakness for mall anchors Dillard's (DDS), Nordstrom (JWN) and Macy's (M).

This downside volatility followed strong technical momentum going into this year, thanks to solid holiday sales during the 2014 holiday season.

Investors not familiar with technical analysis should begin with the notion that a price chart for a stock shows a road map of past price performance, which provides guidance for predicting future share price direction.

Here is how to read a daily chart: There are two moving averages to follow: the 50-day simple moving average is in blue and the 200-day SMA is in green.

Here is how to read a weekly chart: This chart shows weekly price bars going back to the beginning of 2009 when the bull market for stocks began.

The red line tracks the ups and downs of the key weekly moving average. The green line is the 200-week SMA.

The red line that oscillates along the bottom of the chart is the momentum reading on a scale of 0 to 100. A reading below 20 is oversold, and a reading above 80 is overbought.

A technically positive weekly chart occurs when a stock ends a week above its key weekly moving average with the momentum reading rising above 20.

A technically negative weekly chart occurs when a stock ends a week below its key weekly moving average with the momentum reading declining below 80.

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