Ulta Beauty is setting up well for a fresh rally leg.  Since a powerful earnings breakout back on August 31st, which marked day 2 of an eight day winning streak, the stock has been tracing out a healthy consolidation.  During this bull flag phase $ULTA held above a very solid support zone near the May, June and July highs.  This week the stock has returned to the upper band of the current consolidation and appears headed for a breakout.  $ULTA is testing its 2018 highs($290.30)today.  Once this key level is convincingly cleared the stock has room to run.  Next upside target would be the all time highs set back in Q2 of 2017 near $315.00. 

In the near term we consider $UTLA a fairly safe buy.  A close below $282.00 would violate this week’s low sending a clear warning sign that the current consolidation remains a work in progress.