Saturday, February 09, 2008

WMT Analysis for 02.09.2008


Monthly chart shows stock price has been stuck in large trading range. Current resistance is at the $52.32 area. "Sell resistance and buy support" - two weeks into the month, and this is what traders are doing.

Weekly chart better shows the current consolidation/trading range. We have a 3 wave abc corrective pattern into prior resistance. The last leg up off the September 2007 low and into the current resistance shows a corrective 5 waves pattern. Look for a retracement of this last move up, and a re-test of the $42 low before lower. A break of the $41.50 area low will be pretty significant and could get quite ugly.

Daily chart shows price has fallen below the prior high and is now "backend resistance". Next downside target is the .618 fib retracement level of $45.70 area.

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