Digital Realty Trust Inc. showing strength

SIA Charts’ relative strength rankings help investors identify opportunities in stocks which are outperforming their peers or index benchmarks on a relative basis. Outperformance often reflects improving investor expectations for strong company growth or sector growth. The rankings not only help investors to identify which stocks in a universe are outperforming and underperforming against their peers, but also when relative performance trends are changing. Today, we are going to take a look at Digital Realty Trust Inc (DLR). This is the first time we have highlighted Digital Realty Trust Inc. in our commentaries. Digital Realty (DLR) recently entered the Favored Zone of the SIA S&P 500 Index report on June 9th at a price of $176.88 and is showing extremely strong relative strength moves up the S&P 500 report gaining 42 spots in the last month, and 251 spots in the last quarter, exemplifying the consistent money flow increases in the shares over the past little while. Currently the shares reside in the 109th spot out of 505 positions in the report and the shares closed at a price of $177.66 yesterday. In looking at the attached candlestick chart of DLR, we see the shares form a double bottom at the low $80 area in both the October 2022 and April 2023 time frame. Then the shares trended upwards from that point until November of 2024 when it hit its peak at $190. At that point the shares reversed quite heavily until it found a floor at the $135.00 area back in early April of this year.

A strong uptrend has re-asserted itself in the last 2 months. There is a bit of resistance forthcoming right here at the $178 level but if DLR manages to break above this price point the shares will then challenge its all important resistance level at the recent high of $190 from back in November of last year. Support can be found at the $157.00 area.

In looking at the Point and Figure chart at a 2% scale for an investment grade analysis, we see the shares hit a ceiling at $190.21 in December of 2024. A downtrend materialized with a consistent pattern of lower highs and lower lows from that point until April of this year when the shares found a support level at $133.18.

Now the shares are in a strong column of rising X’s so far lasting 13 boxes. Currently, resistance is at its all time high of $194.01. To the downside, support is at its 3 box reversal of $162.34 and, below that, $156.04. The shares currently exhibit a bullish Spread Double Top Pattern and with an SMAX score of 7 out of 10, the shares are exhibiting strong near term strength against the asset classes. Digital Realty owns and operates nearly 300 data centers worldwide. It has more than 35 million rentable square feet across five continents. Digital offerings range from retail co-location where an enterprise may rent a single cabinet and rely on Digital to provide all the accommodations to cold shells where hyperscale cloud service providers can simply rent much or all of a barren power-connected building. In recent years Digital Realty has de-emphasized cold shells and now primarily provides higher-level service to tenants which outsource their related IT needs to Digital. Digital Realty has also moved more into the co-location business increasingly serving enterprises and facilitating network connections. Digital Realty operates as a real estate investment trust.

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