It's the Reaction to the Reaction

After initially dipping on its earnings report, shares of Under Armour are now impressively higher on the session as I write this. 

On the UAA daily chart, updated below, we can see today's candlestick (arrows) being formed had threatened to break a sideways, multi-week base consolidation lower before buyers stepped in and ripped the stock the other direction. Indeed, sometimes it is the reaction to the reaction that matters most, rather than the initial reaction to earnings. 

Longer-term, UAA has been attempting to carve out a massive bottoming formation since it plunged from 2015-2017 and cleaned out many longs. But as long as $20 continued to hold now, bulls have a colorable case for that bottom. Eventually, though, they will need to clear $25 with heavy buy volume to make an emphatic case for a new bull run.

Still, one cannot help but put this UAA move into context of the recent strength in retail, a sector we highlighted for Members over the weekend in more depth than we have in a few months. The retail sector appears to be on the comeback trail, with some intriguing new winners like LOVE and LULU, not to mention some previous ones like UAA now making notable improvements. 

Elsewhere, it sure seems like that a name like Mimecast (MIME) is well under-the-radar in security/cloud/software. MIME is higher by a cool 20% as I write this and printing new all-time highs. We have been long MIME in the VIP arm of the service as an investment for years and consider the lack of buzz to be bullish from a contrarian standpoint, going forward. I suspect other winners like this are lurking in the general software space, too.