In studying charts over the weekend I noticed that an ascending triangle pattern has formed in Williams-Sonoma (WSM - Get Rating).

Williams-Sonoma is a leader in the $117 billion home furnishings industry. The company offers high-end cooking essentials, while it’s Pottery Barn segment provides casual home accessories. Continued improvement in its e-commerce shopping platform has made WSM one of the largest e-commerce retailers in the U.S. and should continue to drive growth.

Take a look at the 1-year chart of WSM below with my added notations:

 Chart of WSM provided by TradingView

Over the past two months, WSM has hit the $88 resistance (red) on multiple occasions, while also climbing a trend line of support (green). Together, these two lines have formed an ascending triangle on WSM. Eventually, the stock will have to break either the $88 resistance or the trendline support.

A trader could buy WSM if/when the $88 resistance level is surpassed with the expectation of a breakout.  And a short trade could be executed if the stock moves lower and the trendline support is broken.

Keep a close eye out for WSM’s latest earnings report which will be released on August 28th.

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Good luck!

Christian Tharp, CMT

@cmtstockcoach

WSM shares were trading at $87.95 per share on Monday morning, up $0.83 (+0.95%). Year-to-date, WSM has gained 22.30%, versus a 3.03% rise in the benchmark S&P 500 index during the same period.

About the Author: christian

Christian is an expert stock market coach at the Adam Mesh Trading Group who has mentored more than 4,000 traders and investors. He is a professional technical analyst that is a certified Chartered Market Technician (CMT), which is a designation awarded by the CMT Association. Christian is also the author of the daily online newsletter Todays Big Stock. More...

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