Many of the worst-hit stocks during the pandemic are leading this latest rally and, among those, are gambling stocks ($DJUSCA). The group broke out yesterday above July highs and now has its collective sight set on the June 8th closing high of 747. Wynn Resorts (WYNN), one of the bigger names, is still attempting to clear its July high. On a relative basis, it’s been a laggard vs. its gambling peers and vs. the benchmark S&P 500. However, a breakout today on very heavy volume could at least turn the short-term chart in its favor:
It’s not shown on the above chart, but WYNN’s volume today is already 5.2 million in the first two hours. It’s only cleared 10 million shares once in the past two months. It’s definitely on pace to do that today. So the big question is….do we see a breakout or a false breakout today? Obviously, the former is a much better development for the gambling group as a whole.
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Tom Bowley, Chief Market Strategist