American Eagle Outfitter, Children’s Place Under Earnings Spotlight

Amid renewed concerns about a slowing China and the details of the Greek bailout, a number of retail companies are scheduled to report quarterly earnings at midweek. It will be interesting to see how the recent shift in investors sentiment toward the anxious and cautionary will be reflected in the responses to quarterly reports from retailers as diverse as Hott Topic (NASDAQ: HOTT) and Men’s Wearhouse (NYSE: MW).

None of Wednesday’s retailers are trading in technically oversold territory. A number of these stocks have been in a tug-of-war between buyers and sellers in recent sessions, closing lower for three out of the past five trading days. This would include American Eagle Outfitter (NYSE: AEO), which has begun to pull back after rallying to its highest level of the year, as well as Children’s Place Retail Stores (NASDAQ: PLCE).

One retailer reporting on Wednesday that is not trading in bull market territory is Bon-Ton Stores (NYSE: BONT). Shares of BONT have closed higher for four days in a row and in fact are closing in on their 200-day moving average from below. The stock has more than doubled since hitting 52-week lows in late November, and in edging higher on Tuesday is now technically overbought in the short-term.

Shares of Bon-Ton Stores Inc. have “consider avoiding” ratings of 3 out of 10 ahead of Wednesday’s open, and a negative, short-term edge of more than one and a half percent. All the other stocks above have neutral ratings between 5 and 7 out of 10.

Traders looking for weakness in retail might want to consider the S&P Retail SPDRS ETF (NYSE: XRT), which has closed in oversold territory for the first time since the end of January. Also turning lower and closing oversold ahead of trading on Wednesday is the Market Vectors Retail ETF (NYSE: RTH).

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David Penn is Editor in Chief of