(1/2) Fundamental Analysis - Hello, this is my strategy on ticker $ULTA. I believe the stock is a great long-term buy-and-hold investment, but not at this time. The stock is undoubtedly overvalued. A recent study published by Macrotrends showed Ulta Beauty shares outstanding for the quarter ending January 31, 2023 were 0.051B. This is a decline of 7.05% YoY. The current downward macroeconomic trend and bearish customer sentiment in the market has caused a lot of disruption. What is really driving this stock? The company's financials look great, but have outpaced the market significantly. I believe this stock will pull back in the near future. Unless the company announces a dividend, I am bearish for the short term. Additionally, the company has seen a significant decrease in volume = a decrease in demand - but the stock is still soaring?
(2/2) Technical Analysis - I believe anywhere above $510 is a good place to short. The S/L should be $530 because I believe if the stock doesn't want to break, it will retest the resistance at $537 and run to around $550. The downside is about $20 and the upside is anywhere from $100-$130 for this short position. I see a clear long-term uptrend, but a short term decline before it heads up again. My target is from $390-$410. On March 13, 2023, the 200MA broke the 50MA on the 1H. I believe the 4H 50MA started a reversal. The 200MA is on the rise to try and break the 50MA. This stock will decline little bit little and eventually when the 200MA breaks the 50MA, we will see a significant decline and price. That should be our selling point.
(2/2) Technical Analysis - I believe anywhere above $510 is a good place to short. The S/L should be $530 because I believe if the stock doesn't want to break, it will retest the resistance at $537 and run to around $550. The downside is about $20 and the upside is anywhere from $100-$130 for this short position. I see a clear long-term uptrend, but a short term decline before it heads up again. My target is from $390-$410. On March 13, 2023, the 200MA broke the 50MA on the 1H. I believe the 4H 50MA started a reversal. The 200MA is on the rise to try and break the 50MA. This stock will decline little bit little and eventually when the 200MA breaks the 50MA, we will see a significant decline and price. That should be our selling point.