Royal Caribbean (SYM: RCL)
For a while, the party was raging aboard Royal Caribbean.
The company posted strong earnings. Consumer demand for cruises surged. And the stock ripped higher—rising from a low of $165 in April to a peak of nearly $290 in early June. That’s a stunning gain of more than 75% in just two months.
But then came the hangover.
As we warned earlier, this run was fueled by greed more than fundamentals. RCL became technically overbought across the board.
Take a look at the chart:
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Relative Strength Index (RSI): Approached the 70 level—classic overbought territory.
MACD: Topped out and began to cross to the downside, signaling a momentum shift.
Williams’ %R: Dipped from extreme highs, another early sign of a trend reversal.
Price Action: The stock failed to break through previous resistance at $290, forming a Watch the video now.
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Company: Another Ship Taking on Water
RSI is rolling over from overbought levels.
MACD has begun a bearish crossover.
Williams’ %R confirmed the momentum shift early.
Support: If CCL breaks below its Norwegian Cruise Line (SYM: NCLH)
NCLH didn’t participate in the rally with the same gusto as RCL or CCL, which could be a red flag in itself.
After rising from around $15 in April to a high near $21.60 in late May, the stock has already retraced below $19. Technically, this stock has been showing relative weakness for weeks.
Falling consumer demand (travel hesitation)
Market rotation into defensive sectors
Even with solid earnings and demand metrics, these headwinds are difficult to overcome. And when greed has already taken stocks far above their sustainable levels, the risk/reward profile clearly tilts to the downside.
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