Home Depot could be a bright spot for the market as we head into a big week of retail earnings 

After a nearly 20 percent sell-off from its January high to April low, Home Depot shares are crawling back toward their record.

Mark Tepper, president and CEO of Strategic Wealth Partners, said the home improvement retailer looks strong into its earnings report Tuesday. Here's what he told CNBC's "Trading Nation" this week:

• Home Depot's first quarter was really disappointing – which Tepper attributes to colder weather, causing consumers to postpone home improvement projects — but he expects the company to have rebounded nicely in the second quarter.

• Tepper notes the consumer has been showing signs of strength lately, which should boost spending and help retail stocks. The XRT retail ETF is at a 52-week high.

• Consumers can either build or they can improve their current home. The issue with building is that the cost to build has far outpaced existing home appreciations, so that's an even less affordable option for the consumer. That leads Tepper to believe that more consumers are going to stay put in their current homes and focus on remodeling projects. Home Depot and Lowe's would be the beneficiaries of that trend.

• While the consensus estimate for earnings is $2.84, Tepper expects Home Depot to top that and end up right around $2.86.

• Tepper will watch several metrics in the report on Tuesday. He hopes to see top-line growth rebound and beat estimates; he also hopes to hear confirmation that Home Depot is benefiting from the current state of the housing market, mortgage rates and the health of the consumer.

Home Depot was trading around $196.90 midday Friday.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's Closing Bell (M-F, 3PM-5PM ET). In addition, he contributes to CNBC and CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

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