BOOT has pulled back to layers of support on the charts
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Boot Barn Holdings Inc (NYSE:BOOT) stock pulled back to layers of support at its April high and 10-day moving average this week. And though the stock slipped after bearish guidance this month, the shares went on to have a bullish outside day reaction, and continued to recent 52-week highs, pointing to underlying technical strength.
Plus, while short interest has been unwinding since January (and is apt to continue given the stock’s strength despite the bearish guidance), short interest still represents 12.7% of BOOT’s available float. It would take shorts over five days to cover their bets, at the stock’s average pace of trading.
The equity also just closed above $112, which is seven times its initial public offering (IPO) price. Our recommended call option has a leverage ratio of 9.0, and will double on an 11.5% rise in the underlying security.