Shares of The Hershey Company (NYSE:HSY) are setting up well for a fresh rally leg.
As the new week began, the stock pierced heavy resistance near the $147.00 area. This key area (March 12th breakdown gap) capped the multi-week April highs as well as the July peak. Most recently HSY has been regaining its footing at the 200-day moving average. This constructive action followed HSY’s promising Q2 earnings report which showed profitable sales.
HSY had its best close since March 11($148.80). The next day the March flush began. By the lows on March 23rd the stock was down 25% from the 2020 peak. By comparison to the S&P 500 Index, a rather shallow sell-off.
A close back below the 200D($141.00) would have indicated more sideways action before HSY was ready to run. However, given the closing price of $148.33, we expect HSY to retest the $162.00 area as this week’s breakout develops.
- HSY current dividend yield=2.2%
- We are long HSY in some managed accounts.