Tackle Today: Walmart Pivots
May 23, 2022
«And here’s the snapback.»
Traders,
Walmart is the poster child for all that ails the retail sector right now. And its price chart provides an excellent case study for trend and pivot analysis. Its post-earnings plunge sent shares skidding for four days in a row bringing the peak to trough drawdown to -27%.
Let’s zoom in on the selloff. Day one was a monster down bar on meteoric volume. Day two followed suit with a similar slide. Day three saw a smaller bar, suggesting some slowing momentum – which is both expected and ordinary. It’s hard for a company as big as Walmart to keep up the pace of losing so much daily. Day four saw a doji form on the lightest volume of them all.
And now, on Monday, WMT stock is up 2.3%. It’s breaking Friday’s high to end the downswing and confirm a new upswing has begun. If we’re lucky, a vigorous, multi-day bounce will ensue. This will provide a chance for counter-trend trades and those who Faded the Fear with bull puts and naked puts to rack up some gains. At the same time, it will allow a clean bear retracement pattern to form and create a second bite at the apple for those who think the downtrend continues.
If we’re unlucky, this one-day bounce will fizzle fast and turn into a choppy mess or low base.
Stay tuned.
Video of the Day: Trading Concept Check: Pivots Supply and Demand
How to interpret pivot points and understand price thresholds of supply and demand. Watch this quick video to help you make sure you understand the importance of support and resistance pivot points as important price thresholds.
Chart of the Day: Walmart ($WMT)
Walmart ($WMT) provides a classic example of slowing momentum and pivot formation. Keep it clean, bulls, and give us a strong pop.
Today’s line up
Traders Lounge 11 AM EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
Halftime Report 12:30 PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.
S.T.E.P. MasterMind Group 8:30 PM EST
In these MasterMind Groups, you will learn directly from our experienced coaches exactly how to apply the S.T.E.P. Swing Trading System discipline in the current market conditions.
Weekend Reports
Watch the Stock, Options, Commodity, and Forex Reports to help you prepare for the week.
Financial freedom is a journey
Sign up now and gain unfettered access to all of the quality content and powerful Scouting Reports that our Pro Members enjoy for 15-days absolutely free with no strings attached and let us show you what your trading has been missing.
Legal Disclaimer
Tackle Trading LLC (“Tackle Trading”) is providing this website and any related materials, including newsletters, blog posts, videos, social media postings and any other communications (collectively, the “Materials”) on an “as-is” basis. This means that although Tackle Trading strives to make the information accurate, thorough and current, neither Tackle Trading nor the author(s) of the Materials or the moderators guarantee or warrant the Materials or accept liability for any damage, loss or expense arising from the use of the Materials, whether based in tort, contract, or otherwise. Tackle Trading is providing the Materials for educational purposes only. We are not providing legal, accounting, or financial advisory services, and this is not a solicitation or recommendation to buy or sell any stocks, options, or other financial instruments or investments. Examples that address specific assets, stocks, options or other financial instrument transactions are for illustrative purposes only and are not intended to represent specific trades or transactions that we have conducted. In fact, for the purpose of illustration, we may use examples that are different from or contrary to transactions we have conducted or positions we hold. Furthermore, this website and any information or training herein are not intended as a solicitation for any future relationship, business or otherwise, between the users and the moderators. No express or implied warranties are being made with respect to these services and products. By using the Materials, each user agrees to indemnify and hold Tackle Trading harmless from all losses, expenses and costs, including reasonable attorneys’ fees, arising out of or resulting from user’s use of the Materials. In no event shall Tackle Trading or the author(s) or moderators be liable for any direct, special, consequential or incidental damages arising out of or related to the Materials. If this limitation on damages is not enforceable in some states, the total amount of Tackle Trading’s liability to the user or others shall not exceed the amount paid by the user for such Materials.
All investing and trading in the securities market involves a high degree of risk. Any decisions to place trades in the financial markets, including trading in stocks, options or other financial instruments, is a personal decision that should only be made after conducting thorough independent research, including a personal risk and financial assessment, and prior consultation with the user’s investment, legal, tax and accounting advisers, to determine whether such trading or investment is appropriate for that user.
