By Doug Busch
After a prolonged period of underperformance, footwear stocks are beginning to show signs of renewed strength. A number of industry names have recently found their footing, pun intended, at key moving averages, and are starting to outperform the broader market on a relative-strength basis. While investor sentiment toward the group remains cautious, the charts for Crocs and Deckers Outdoor suggest the risk-reward profile is becoming increasingly attractive.
Within the broader consumer discretionary sector, footwear stocks have been one of the weaker-performing groups, outperforming only recreational products, gaming, and tire-related names. Even after a combined 10% rally over the past two weeks, Nike remains roughly 43% below its 52-week high, highlighting the extent of the group's prior underperformance. However, signs of improvement are beginning to emerge. Birkenstock has surged more than 40% over the past two weeks, while On Holding AG (ONON) is currently riding a four-week winning streak, its longest sustained advance in more than a year.
Among the footwear names showing the most promise, Deckers Outdoor and Crocs stand out. A review of their charts suggests both stocks may be positioned for further gains.
Deckers Outdoor, best known for its UGG and HOKA brands, has gained 10% over the last month. It has rallied more than 20% over the last two weeks. On its weekly chart, it has carved out a bullish inverse head and shoulders formation dating back to last March following the end of a 10-week losing streak.
Looking at the daily chart, Deckers appears to be in the early stages of forming a double-bottom pattern. The setup emerged after the stock failed to break above a bullish ascending triangle in late February, encountering resistance near the $125 level on three separate occasions.
Momentum indicators have begun to improve. RSI formed a bullish divergence between March and May, with RSI registering a higher low even as price recorded a lower low. In addition, the appearance of dojis on May 14 and May 19 suggested selling pressure was beginning to fade and that a bottoming process was underway.
The technical picture improved as shares climbed above both their 50-day and 200-day simple moving averages last week. Investors could consider entering on a reclaim of the $113.97 double-bottom pivot, a level that was cleared on May 27. The stock could advance toward $140 by year-end, representing a 26% upside from current levels. Remain bullish above $104.
Deckers Outdoors was trading around $111 Tuesday.
Crocs, the maker of its iconic foam clogs, is up 39% year to date, and trades just 2% below its 52 week high. On its weekly chart it is quickly approaching a double bottom trigger of $122.94 in a two-year-long base. It has gained 24% during the last two weeks.
Looking at the stock's one-year daily chart, one of the most encouraging developments is its relative strength versus consumer peers. The ratio chart against the XRT has been trending higher since the start of 2026.
The technical picture improved significantly with the completion of a bullish island reversal on February 12, marked by a 19% gap higher. That move was preceded by a sharp 29% gap down last August. More recently, the stock broke above a double-bottom pivot at $108.22 on May 21 and has since strung together an impressive 10-session winning streak.
The current base began forming after a bearish dark cloud cover candle on April 21 and developed shortly after a breakout from a short cup-base pattern. Investors could consider entering on a pullback toward $115. My target is $165 by early 2027, implying 39% upside from current levels. Remain bullish above $105.
Crocs was trading around $117 Tuesday.
Doug Busch is the senior technical analyst at Barron's Investor Circle . His technical view is added to stock picks, including those published exclusively for Investor Circle readers. A glossary of technical terms is updated regularly with new entries.
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
June 02, 2026 15:30 ET (19:30 GMT)
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