The CAD 56.9 support area, currently tested, might facilitate a technical rebound. The company’s fundamentals could validate this scenario.

From a fundamental viewpoint, the society has a growth potential of its revenue for the next exercices and moreover EPS is often revised upward by the consensus of analysts.

Technically, the security is in a negative configuration in the short term as the bearish trend of 20-day moving average, currently at CAD 58.4, shows. Nevertheless, the stock seems in an oversold situation, near to its CAD 56.9 support in daily data. This level might stop the bearish trend in the short term.

Therefore, the proximity of the CAD 56.9 support is an opportunity to take a long position in Dollarama. The first goal is a return in the CAD 59.75 resistance area, that is a potential of 4.1%. In fact, the security has to cross this area in order to re-establish a bullish trend in the short term. A stop loss order can be placed under the support currently tested.