WMT – into the high 60’s?

 

1/30/2016 – WMT propelling higher.  68 or 72 potential targets, or quite frankly, new highs? too early to tell but it has been extremely bullish.

if you want to follow along – scroll down to the bottom where we show patterns into the HIGH and then use geometry and patterns to find the 55-56 area as support.

THERE IS ZERO FUNDAMENTAL ANALYSIS IN LOOKING AT THESE SWING HIGH AND LOW TARGETS.

Bart

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$WMT hit the support area and has been climbing.  certainly appears the high 60’s could be in play? Please see below.

hope you had a great Festivus w/ family and friends.

spend some time working thru this post from the bottom up …

rock on, ok?

Bart

 

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Just a heads up … were “there” or “close” w/ regards to potential WMT support.

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Here’s the picture of $WMT in 2013 – sure looked, at the time, we were finishing 5 waves and the circle area was the target area for a “potential” top.

$WMT moving into the highs - Nov 2013
$WMT moving into the highs – Nov 2013

Target was hit and yesterday the move rally began.  Hard to believe it’s roughly 2 years ago that this pattern was ID’d and it took that long for it to start to make the “news” so to speak.  Anyway, now that the chaos and news is getting ahold of it, believe a look at a potential long swing trade in the mid to low 50’s is reasonable.

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Here’s the daily chart … note the square root target of 56 lands right on the .382 retracement from the all time low. I like that … watch that 55-56 level.

Just another math thing … 90/1.618 = 56.  Another reason to like the level.

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Here’s the weekly 1/8th projection method …

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55-56 sure seems like it’s key WHICH MEANS IF IT FAILS THEN WE GOT SOMETHING REALLY WRONG AT THE CIRCLE K.

B

 

 

 

WMT – into the high 60’s?

$WMT hit the support area and has been climbing.  certainly appears the high 60’s could be in play? Please see below.

hope you had a great Festivus w/ family and friends.

spend some time working thru this post from the bottom up …

rock on, ok?

Bart

 

Page_15-12-26_12-45-47

 



 

Just a heads up … were “there” or “close” w/ regards to potential WMT support.

Page_15-11-04_20-51-19

 


Here’s the picture of $WMT in 2013 – sure looked, at the time, we were finishing 5 waves and the circle area was the target area for a “potential” top.

$WMT moving into the highs - Nov 2013
$WMT moving into the highs – Nov 2013

Target was hit and yesterday the move rally began.  Hard to believe it’s roughly 2 years ago that this pattern was ID’d and it took that long for it to start to make the “news” so to speak.  Anyway, now that the chaos and news is getting ahold of it, believe a look at a potential long swing trade in the mid to low 50’s is reasonable.

Page_15-10-15_10-02-24

Here’s the daily chart … note the square root target of 56 lands right on the .382 retracement from the all time low. I like that … watch that 55-56 level.

Just another math thing … 90/1.618 = 56.  Another reason to like the level.

Page_15-10-15_10-14-08

Here’s the weekly 1/8th projection method …

Page_15-10-15_10-18-23

55-56 sure seems like it’s key WHICH MEANS IF IT FAILS THEN WE GOT SOMETHING REALLY WRONG AT THE CIRCLE K.

B

 

 

 

WMT – heads up support area approaching

Just a heads up … were “there” or “close” w/ regards to potential WMT support.

Page_15-11-04_20-51-19

 


Here’s the picture of $WMT in 2013 – sure looked, at the time, we were finishing 5 waves and the circle area was the target area for a “potential” top.

$WMT moving into the highs - Nov 2013
$WMT moving into the highs – Nov 2013

Target was hit and yesterday the move rally began.  Hard to believe it’s roughly 2 years ago that this pattern was ID’d and it took that long for it to start to make the “news” so to speak.  Anyway, now that the chaos and news is getting ahold of it, believe a look at a potential long swing trade in the mid to low 50’s is reasonable.

Page_15-10-15_10-02-24

Here’s the daily chart … note the square root target of 56 lands right on the .382 retracement from the all time low. I like that … watch that 55-56 level.

Just another math thing … 90/1.618 = 56.  Another reason to like the level.

Page_15-10-15_10-14-08

Here’s the weekly 1/8th projection method …

Page_15-10-15_10-18-23

55-56 sure seems like it’s key WHICH MEANS IF IT FAILS THEN WE GOT SOMETHING REALLY WRONG AT THE CIRCLE K.

B

 

 

 

$WMT ,November 2013 looking for the top and now 55-56 for support

Here’s the picture of $WMT in 2013 – sure looked, at the time, we were finishing 5 waves and the circle area was the target area for a “potential” top.

$WMT moving into the highs - Nov 2013
$WMT moving into the highs – Nov 2013

Target was hit and yesterday the move rally began.  Hard to believe it’s roughly 2 years ago that this pattern was ID’d and it took that long for it to start to make the “news” so to speak.  Anyway, now that the chaos and news is getting ahold of it, believe a look at a potential long swing trade in the mid to low 50’s is reasonable.

Page_15-10-15_10-02-24

Here’s the daily chart … note the square root target of 56 lands right on the .382 retracement from the all time low. I like that … watch that 55-56 level.

Just another math thing … 90/1.618 = 56.  Another reason to like the level.

Page_15-10-15_10-14-08

Here’s the weekly 1/8th projection method …

Page_15-10-15_10-18-23

55-56 sure seems like it’s key WHICH MEANS IF IT FAILS THEN WE GOT SOMETHING REALLY WRONG AT THE CIRCLE K.

B

 

 

 

WMT set up …slow down and digest the logic… this is important, I think

BUY WMT (?)

  • note – measured move ( in price and time), polarity and an extension target ….
  • needs to stop here and start back up, IMHO.
  • we are also sitting on a former resistance zone of 15 years folks .. if break down from here – we’ll call that a “what’s the fighter thinking” moment …
  • here’s the charts:

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with the above being posted I’m going to try and present the plausible IF-THEN scenario using PATTERNS and ratio analysis

  1. Ratio Analysis is VERY powerful and when coupled w/ PATTERNS it really gives you a flavor for institutional positioning and money flow.
  2. Certain stocks “own” the world of safety, risk-off, “if the word ends tomorrow I buy xxx”, etc.
    1. $WMT is one of those names.  A lot of the public shops at $WMT.
    2. So IF WMT is strengthening from a relative strength perspective then institutions are taking risk off … if it’s losing strength then risk is on …
    3. How do we know when to “wax on” or “wax off?” (Pardon the Karate Kid pun)
      1. HINT: PATTERNS.
  3. Here’s the text books SELL PATTERN on the SPY/WMT ratio
    1. What’s this mean?
      1. IF the PATTERN works then WMT is going to be a “risk off” asset and the SPY will lose relative strength to WMT.

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CLIFF NOTES: why is this important? See chart below … EVERY TIME since 2000 that the ratio inflected the SPY did at the EXACT TIME.

SPY/WMT ratio w/ SPY overlaid (blue line)
SPY/WMT ratio w/ SPY overlaid (blue line)

SO – “if then” w/ me …

IF this pattern holds then the US Equity market is in on the magical mystery tour … step right up, come this way.

IF it fails (the ratio goes higher) then this correction “should” end soon and game on ….

HINT HINT: watch monitor this ratio, closely.

THIS IS WHAT I SEE AND NOT WHAT I BELIEVE ….

Cheers and rock on, ok?

Bart

Ratio patterns holding …

CLIFF NOTES: we’ve shown the sector rotation being shown by ratio analysis before.  we’ve also shown how every major inflection (up and down) has been due to the ratio’s bottoming or topping.  we’ve also shown how patterns have failed to hold and have confirmed the move higher in stocks the past few months …well, for now they are holding support.  I ask that you go back and revisit my swing low post – it’s all about the swing low in the next couple days. go here: http://bartscharts.com/2014/03/16/swing-low-sweet-chariot/

 

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WMT / NYSE Index Ratio and the KEY support

CLIFF NOTES: patterns exist on the ratios/we use ratio analysis to look for sector rotation and when the RATIO’s inflect there are usually inflection points.  We are at a key level in the WMT / SPX ratio.  Also, I added the NYSE Index overlaid.  Note EVERY HIGH AND LOW was at this ratio’s SUPPORT and RESISTANCE.  We are at key support – TODAY – on this ratio.  Also, the XLP/SPX ratio has a foldback occurring and I would “think” it will find support but sure doesn’t look like it …

BOTTOM LINE – this entire thing is in unchartered territory.  Understand the scarce resource and monetize on that … stay away from these markets.

BART

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Using ratio’s for relative strength comparison

If the Numerator is bigger than the Denominator then the ratio goes UP.  If vice versa, the ratio goes down.  If we put one security over another then we can plot the relative strength and note when a shift in this relative strength takes place.  This shift can show rotation. What you’ll find is the XLP/$SPX ratio EXACTLY nailed all the highs and lows since 2000.  Yes, the high in 2000 was accompanied by an inflection in the ratio … what is of interest now is the ratio has not made a new low while the S&P makes new highs. This divergence is important …

XLP/SPX showing a buy after a typical a-b-c correction
XLP/SPX showing a buy after a typical a-b-c correction

 

here’s a long term monthly of the ratio posted on this blog in/around November.  2014 has shown a divergence that has not occurred since the XLP came on line.  The divergence is a “new high” in the S&P while the ratio has NOT made a new low.  Monitor …

long term chart showing tops and bottoms since 2000 have corresponded in the XLP/SPX ratio inflectin
long term chart showing tops and bottoms since 2000 have corresponded in the XLP/SPX ratio inflection

 

lastly, I like to use a “real world” or “main street USA” stock to monitor w/ the ratio analysis … WMT/SPX has also been extremely helpful in topping or bottoming at major inflection points.  Suprisingly, this ratio has not made new lows either.  In the classic technical analysis realm – looks like a double bottom forming.

WMT/SPX ratio
WMT/SPX ratio

WMT / SPX ratio revisted

CLIFF NOTES: support found in the relative strength of WMT/SPX. When this ratio goes UP the stock market goes down, when the ratio goes DOWN the stock market goes UP.

In the world of ratio analysis we are looking at the relative strength of something versus something.  This has nothing to do w/ the RSI.  If the numerator is BIGGER (more strength) than the denominator then the ratio goes UP and vice versa.  This does not mean that the individual securities being compared will not go up or down.  Just they should go up or down based on the strength or weakness.

The concept behind the WMT/SPX ratio is one of volatility and risk.  The only thing I can say is to look at the chart below:

WMT/SPX ratio w/ the S&P (blue line) overlaid
WMT/SPX ratio w/ the S&P (blue line) overlaid

when this ratio hits a bottom the market tops and vice versa.  now, we have been watching patterns get hit and work for a time but then fail (BUY patterns of the ratio) and, most recently, we hit another pattern and the ratio has shown strength and, well, the S&P has shown some weakness. Also, note the new highs in the S&P were NEVER confirmed by new lows in the ratio.  per a couple posts ago – it’s all about the swing low – so watch weekly swing lows.  Until they are taken out, this band can definitely play on.  Guess it doesn’t matter that the band is on the Market Titantic.

Just bringing up a simple technique to look for POTENTIAL correlations that most would not consider …

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