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Time to Short Home Depot and Lowes: Charts Say It All

It's time to short home improvement giants Home Depot (HD) and Lowes Companies (LOW) following Monday's performance at the open and on potential earnings reaction strength. Here's why:

Home Depot opened just below its downtrend resistance of $156.52, which is the first level at which to short this stock. Lowes opened with a test of a Fibonacci Retracement level of $78.12, which is the first level at which to short this stock.

One reason to short specific stocks in the S&P 500 is that this major equity average ended last week on Aug. 11 with a weekly "key reversal". The S&P set an all-time intraday high on Aug. 8 then closed Aug. 11 below the low of the week of Aug. 4, which defines the "key reversal".

Home Depot reports its earnings before the open on Aug. 15 and analysts expect the company to earn $2.21 a share. Most say that the stock is a buy, and its weekly chart is positive. Even so, it's time to short this stock...


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