Coach (NYSE:COH) appears to have left the station in reaction to Tuesday's earnings report as well as perhaps news that the company is no longer interested in acquiring Kate Spade & Company (NYSE:KATE).
That said, a very big-picture view of COH shows that Tuesday's up-spike has propelled the price structure toward completion of a massive 3-year accumulation/base formation that will trigger much higher potential if the price structure climbs and sustains above 43.70/90.
If that signal emerges, Coach will face serious technical challenges trying to get to the 'promised land' target zones of 54-55, and then to 60-61.
Overcoming Resistance
There is heavy resistance along the way, which can only be overcome if 1), the economy begins to accelerate beyond 1% growth and 2), the retail environment improves and 3), anticipated forthcoming quarterly earnings momentum resumes an upward trajectory.
If the developing, maturing base pattern means anything, then all of the above-mentioned conditions should be present, driving the share price higher in the upcoming weeks and months.
