Traders have love-hate relationship with this stock, I personally have a trader friend who doesn't like WMT. According to him, it doesn't have the properties of a growth stock.
Yet I have been watching it for a couple of months and traded calls all the way from the bottom around 83 to the inflexion point before earnings where I had closed all positions. Retrospectively this was stupid but felt like gambling.
Price exploded after earnings as Walmart investments in their digital presence start to pay off. Flipkart deal has been highly criticised for the high price they paid but it looked like the right price to pay in order to dent AMZN market domination in this highly potential market.
If we zoom out the picture, the retail sector is doing well, all competitors have been posting very good earnings numbers. Although the whole market is expected to weaken in September, I expect WMT to over-perform SPX. WMT is one of the dividend stock, investors want to own it even in a recession. During GFC, this stock was one of the few who was green during the GFC.
Technically, the picture is bright. Post earnings price topped at $100 and retraced under heavy insiders selling pressure. Even though it may look as a negative, these selling were scheduled, this this looks as a non event. Price has been forming a very nice multi months Cup and Handle pattern and we are currently sitting at the bottom of the handle inside a 3 days consolidation. We also closed above the 10dma which indicates momentum is till intact. RSI above 60 confirms this positive picture.
To me it seems, all the ingredients are there for a run up to $100, then $110 (ATH) and finally to the $138 measured target for the CnH pattern identified.
Will probably wait for the beginning of the week morning dip, to buy some OCT ATM calls with a target of $100. Will sell if price closes below 10dma on the daily,
Yet I have been watching it for a couple of months and traded calls all the way from the bottom around 83 to the inflexion point before earnings where I had closed all positions. Retrospectively this was stupid but felt like gambling.
Price exploded after earnings as Walmart investments in their digital presence start to pay off. Flipkart deal has been highly criticised for the high price they paid but it looked like the right price to pay in order to dent AMZN market domination in this highly potential market.
If we zoom out the picture, the retail sector is doing well, all competitors have been posting very good earnings numbers. Although the whole market is expected to weaken in September, I expect WMT to over-perform SPX. WMT is one of the dividend stock, investors want to own it even in a recession. During GFC, this stock was one of the few who was green during the GFC.
Technically, the picture is bright. Post earnings price topped at $100 and retraced under heavy insiders selling pressure. Even though it may look as a negative, these selling were scheduled, this this looks as a non event. Price has been forming a very nice multi months Cup and Handle pattern and we are currently sitting at the bottom of the handle inside a 3 days consolidation. We also closed above the 10dma which indicates momentum is till intact. RSI above 60 confirms this positive picture.
To me it seems, all the ingredients are there for a run up to $100, then $110 (ATH) and finally to the $138 measured target for the CnH pattern identified.
Will probably wait for the beginning of the week morning dip, to buy some OCT ATM calls with a target of $100. Will sell if price closes below 10dma on the daily,