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There Must Be Something In The Sauce – Pizza! Pizza!

ByDragonfly Capital
AuthorGregory W. Harmon
Published 12/18/2012, 12:56 AM
Updated 05/14/2017, 06:45 AM

Domino’s Pizza (DPZ) is making new all time highs and with rising trend support and a bullish Relative Strength Index (RSI) looks to continue. But there truly must be something in the sauce because two other pizza chains, Papa Johns (PZZA) and Pizza Inn (PZZI) are also looking strong. In fact these two may be ready for a big move.

Papa Johns (PZZA)
PZZA 1
Papa Johns (PZZA) fell out of an expanding wedge in mid November but found footing at the 200-day Simple Moving Average (SMA). Since then it rose back near the top of that wedge and has consolidated in a bull flag. Monday it probed out of the top of the flag and over the outsized volume by price bar at 53. It has a bullish RSI and a Moving Average Convergence Divergence indicator (MACD) that is positive to support a push up. A move over the top of the flag and then through resistance at 54 gives a Measured Move to 60 and new all time highs.

Pizza Inn (PZZI)PZZI
Pizza Inn (PZZI) is not near all time highs. It lived life as a momentum darling late in 2011 and suffered the fate of momentum traders fleeing the scene the first half of this year. But recently it is showing signs of a big move as well. Consolidating for over 2 weeks in a very narrow range after a move off of the 2.65 level gives it a Measured Move higher to 4.15, over the August spike. This would also continue the series of higher lows and higher highs, very bullish. So maybe there is something in the sauce. Pizza, Pizza!

Disclaimer: The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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