By Doug Busch
Consumer discretionary stocks have largely treaded water over the past year, gaining just 2% as measured by the Consumer Discretionary Select Sector SPDR ETF. Among the 11 major S&P sectors, only financials fared worse as the State Street Financial Select Sector SPDR ETF is unchanged over the past year while the S&P 500 has gained 12%.
Critics may argue that the muted performance reflects the heavy weighting of Tesla and Amazon, which together account for roughly 42% of the ETF. One area of consumer discretionary that has done well is footwear. Deckers Outdoor is already higher by 12% year to date, fueled in part by a powerful 19% earnings surge on Jan. 30. The stock has since formed a constructive bull flag pattern, and a decisive break above $120 could open the door to a move toward the $140 area.
Other footwear stocks could soon follow Deckers higher. Nike trades roughly 26% below its most recent 52-week high, but if the stock can stabilize above the $60 level it would likely carve out a bullish inverse head and shoulders formation -- an early signal that downside momentum is beginning to fade. Birkenstock could be forming a double bottom and doing a round trip back to when it came public in late 2023.
Another footwear stock that has caught my attention is Crocs. Let's examine the stock across both the daily and monthly time frames to see what the technical picture reveals.
Looking at the daily chart, there are several constructive developments worth highlighting. Yesterday, the stock surged 19% on a well-received earnings report, completing a bullish island reversal in the process. The advance stalled at the very round $100 level, just shy of filling an upside gap from Aug. 6. Importantly, the move reclaimed both the 50- and 200-day simple moving averages and cleared a bullish inverse head and shoulders pivot at $90. At the pattern's trough, a doji candle on Nov. 14 hinted that selling pressure was becoming exhausted.
The monthly chart also offers several bullish indicators. Notably, candlestick formations have historically played a decisive role in marking both peaks and troughs. Three separate doji candles, in November 2021 (which also formed a bearish evening star), February 2023, and September 2024, served as warning signals, each preceding drawdowns ranging from 39% to 62%.
Conversely, when this stock builds momentum, the advances tend to be powerful and sustained. From May 2017 through November 2018, shares rose 15 of 19 months, delivering a 375% gain. Later, following a bullish piercing line in April 2020, the stock rallied through November 2021, climbing 1261% during a remarkable 19 of 20 month winning streak.
Turning to the 50 month simple moving average, a decisive move above that level would confirm improving long-term momentum and offer an add on double-bottom buy point above the $122.94 pivot.
If this momentum continues, Crocs' comeback may prove to be more than a short term bounce, it could mark the start of a durable new uptrend.
Crocs was trading around $94 Friday. A pullback toward the $93 area would offer an attractive entry, with a move toward $112 by mid 2026. This represents roughly 18% upside from current levels. The bullish thesis remains intact as long as the stock holds above $86.
Doug Busch is the senior technical analyst at Barron's Investor Circle . His technical view is added to stock picks, including those published exclusively for Investor Circle readers. A glossary of technical terms is updated regularly with new entries.
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
February 13, 2026 11:12 ET (16:12 GMT)
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