Deckers Fails Test, Falls (DECK)

Shares of Deckers Outdoor DECK, an outdoor footwear company, were looking to make a run at their 52-week high of $94.70 this morning, but the early surge was quickly sold into and bears pushed the stock 1.12% into negative territory at $89.46. Sellers jumped in at 9:40 a.m. EST, just after the stock hit a new intraday high of $92.77 and were able to get it into the red by 10:15 a.m. EST. There has been virtually no buying activity throughout the afternoon, which doesn't bode well for the equity in the near term. A more technical glimpse at a six-month daily chart of Deckers points to a significant correction in the near term in light of today's selloff. As you can tell by looking at the chart, the nearest moving average (20-day) is nearly 4% lower than the current trading price with the 50-day following closely behind. Beyond that, the 200-day is sitting extremely down at $68.76; a rather worrisome chasm. Downward trend lines in the RSI (14) and MACD (8, 17.9) indicators add to the bearish sentiment. If this double top plays out, a test of the $77.71 is imminent with a lot of room to the downside beyond that. The trade sets up well for bears as a breakout above the 52-week high of $94.70 (or $93 if you are more conservative) is the obvious stop out; three to five points of upside risk with a potential reward of 11 to 16 points.