Carnival (CCL): Big base breakout watch

Carnival Corp. (CCL) is in position for an upside breakout from a big base dating back to the 2020 COVID-19 pandemic low. We highlighted the bullish potential for CCL in the Straight from the Chart blog on both October 17 and September 12, but the pattern has taken additional time to develop.

CCL has the potential to break out from a big base. A decisive rally above 31.50-32.80 (38.2% retracement of the 2018 to 2022 decline and September high) is required to confirm the big base and suggest further upside to 39.40 (50% retracement), 47.26 (61.8% retracement), and 57 (pattern count). Until then, continuing to defend the zone between the rising 26- and 40-week moving averages from 28.92 to 26.06 and remaining above the late November higher low at 24.60 would keep the pattern constructive for CCL.

CCL is also improving relative to the S&P 500 and remains within a leadership trend from October 2022. Sustaining relative strength above the weekly moving averages vs. the S&P 500 would maintain this view.

Chart 1: Carnival Corp. (CCL) (top) and relative to the S&P 500 (bottom)