Carmax (KMX) has been on fire lately. The company has shed a weak auto industry and just chugged along, producing staggering results. I'll be the first to admit that I wasn't exactly bullish on KMX in the past as it suffered from lower prices and margins. But those things - as evidenced by the Q2 report - are things of the past and the stock is rightfully hitting new highs. Given the fact that new highs are being hit, is the stock worth chasing here?

Let's begin with the chart as it is a thing of beauty if you're long. There's a well-defined uptrend that has been riding the rising 200DMA for many months now and that was the launching point yet again for the most recent rally. The 200DMA is at $64 now and will provided meaningful support unless and until the stock breaks down below it. That hasn't happened since 2015 so it seems safe to say the 200DMA is something to watch if you're long.

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