Benzinga - Crocs, Inc (NASDAQ: CROX) surged over 14% higher when the market opened on Thursday where the stock ran into sellers who bumped it down about 7% off the high-of-day.
The spike higher was due to a positive reaction to the company's fourth-quarter earnings print. For the quarter, Crocs reported EPS of $2.65 on revenues of $945.16 million, beating the respective estimates of $2.26 and $939.26 million.
Crocs also guided first-quarter earnings per share to come in above the consensus estimate, reporting it expects EPS of between $2.06 to $2.19 versus an estimate of $2.02 per share.
During the second half of 2022, Crocs showed strength compared to the general market, surging 122% between July 1 and Dec. 30 of that year, compared to the S&P 500, which rose just 1.56% during that same time frame.
On Jan. 18, Crocs topped out at $131.18, where the stock entered a downtrend under a descending trendline, which the stock broke up from on Thursday.
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The Crocs Chart: When Crocs broke up from the descending trendline on Thursday, the stock negated its downtrend but hasn’t yet confirmed a new uptrend. For an uptrend to confirm, Crocs will have to retrace to form a higher low above the lower low of $110.69, which was printed on Feb. 10.
- On Thursday, Crocs was working to print a shooting star candlestick on the daily chart, which could indicate lower prices will come on Friday. If that happens, bullish traders can watch for the stock to reverse upwards off the lower range of the lower gap, which may act as support.
- The second most likely scenario is that Crocs will trade sideways on Friday to possibly form an inside bar pattern. If that takes place, the pattern leans bullish for continuation next week.
- There's a chance that Crocs has developed a massive cup-and-handle pattern on the daily chart, with the cup formed between November 2021 and mid-January and the handle formed between mid-January and Wednesday. If the pattern is recognized, Crocs could be headed toward new all-time highs and blue skies over the course of 2023.
- Bearish traders want to see big bearish volume come in and drop Crocs down below the lower range of the gap, which could drop the stock back under the descending trendline. If that occurs, Thursday’s bullish break will serve as a bull trap and the downtrend could resume.
- Crocs has resistance above at $135.67 and $145.37 and support below at $126.33 and $111.18.
Photo courtesy of Crocs.
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