Costco Wholesale Corporation (COST)

Analyzing Relative Performance

StockStreaks focuses primarily on Relative Strength. Currently, Costco Wholesale Corporation is showing a W7 Relative Streak. This means that for the last 7 consecutive trading sessions, the stock has outperformed the S&P 500 index. During this specific streak, the stock has moved approximately 8.48% relative to the market benchmark.

Absolute Price Action

On a raw price basis, COST is on a W3 Absolute Streak, meaning it has closed green (higher) for 3 days in a row. While relative performance isolates stock-specific behavior, this absolute streak reflects the raw capital appreciation (or depreciation) experienced by holders, totaling 2.28% during this period.

Tension Score & Mean Reversion Potential

Currently, COST is registering a Tension Score of 41/100, which is considered Neutral. This proprietary metric indicates that the recent move is behaving within normal expectations relative to its historical volatility profile. Historically, when COST reaches comparable tension levels, our models calculate a 50% probability of it outperforming the SPY in the next session, suggesting a potential mean reversion event.

Relative Prediction Analysis

For COST, we compare the Historical Reversal Rate (20%) to the Model Probability of a reversal.

The positive divergence of +30% indicates that our models see higher odds of a reversal (underperforming) than history suggests. This is often driven by an overextended Tension Score (41) or extreme momentum readings that suggest the current relative move is due for a correction.

Absolute Prediction Analysis (Green Day)

We analyze the likelihood of COST closing higher tomorrow compared to its historical W3 reversal frequency (48%).

The positive divergence of +1% suggests that a reversal (red day) is more likely than usual. This typically occurs when a move becomes overextended or encounters significant technical resistance.

Metric Definitions

• Historical Reversal Rate: The percentage of time in the past that a streak of this specific type and length ended (reversed) on the very next day. This is an unconditional historical frequency.
• T+1 Return: The percentage return of the asset on the next trading day (T+1) following the streak event. This is the primary outcome metric used to evaluate predictive edge.
• Streak Pattern (e.g., L3, W5): "L" denotes a Losing streak (underperforming SPY or closing Red), "W" denotes a Winning streak. The number indicates consecutive days.
• Relative Return: The stock's return minus the SPY's return for the same period. If COST is +1% and SPY is +2%, the Relative Return is -1%.
• Absolute Return: The raw price change of the asset. If COST is +1%, the Absolute Return is +1%.