Costco Wholesale Corp. (COST US)

Costco Wholesale Corporation is a membership warehouse club that sells a variety of food, automotive supplies, toys, hardware, sporting goods, jewellery, electronics, apparel, health, and beauty aids, as well as other goods with a robust international footprint. The company serves customers through its warehouses and e-commerce sites.

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Technically, a steady and rising Volume Price Trend (VPT) supports a bullish outlook for the stock (see insert). A VPT that rises in tandem with the share price suggests that upward movements are underpinned by strong trading volumes, an indication of solid demand and investor conviction. This is a key signal, as price trends supported by volume are typically more sustainable than those driven solely by price action.

The stock has a strong track record of outperforming in the fourth quarter, supported by seasonal demand and upbeat investor sentiment. Since 2000, average monthly returns show a clear pattern, with October and November posting solid gains of +3.5% and +3.6%, driven by key retail periods like back-to-school, holiday shopping, and year-end spending. Even December, with a more modest +0.7% return, adds to the seasonal strength. This consistent performance points to institutional confidence and gives investors a solid, data-backed reason for a bullish view heading into year-end.

Technical analysis