Wal-Mart Stores, Inc. (NYSE: WMT)

Wal-Mart Stores, Inc. operates retail stores in various formats worldwide. It operates retail stores, restaurants, discount stores, supermarkets, supercenters, hypermarkets, warehouse clubs, apparel stores, Sam’ss Clubs, and neighborhood markets, as well as walmart.com; and samsclub.com. The company’s stores offer meat, produce, deli, bakery, dairy, frozen foods, alcoholic and nonalcoholic beverages, and floral and dry grocery; health and beauty aids, baby products, household chemicals, paper goods, and pet supplies; electronics, toys, cameras and supplies, photo processing services, cellular phones, cellular service plan contracts and prepaid service, and books; stationery, automotive accessories, hardware and paint, sporting goods, fabrics and crafts, and seasonal merchandise; pharmacy and optical services; shoes, jewelry, accessories, and apparel for women, girls, men, boys, and infants; and home furnishings, housewares and small appliances, bedding, home décor, outdoor living, and horticulture products. Its stores also provide tobacco, tools and power equipment, office supplies, furniture, grills, gardening products, and mattresses; and wireless, software, video games, movies, and music products, as well as operate gasoline stations, and tire and battery centers.

To review Wal-Mart’s stock, please take a look at the 1-year chart of WMT (Wal-Mart Stored, Inc.) below with my added notations:

1-year chart of WMT (Wal-Mart Stored, Inc.)

WMT has created a couple of important price levels to watch. WMT has formed a clear resistance at $75 (navy), which would also be a 52-week high breakout if the stock could manage to break above it. In addition, the stock is climbing a short term, up-trending support level (red) over the last (2) months. Eventually, the stock will have to break one of those two levels.

The Tale of the Tape: WMT has an up trending support and a 52-week resistance level to watch. A long trade could be made on a breakout above the $75 resistance, preferably on higher than average volume, with a stop placed below that level. A break below the up trending support could be an opportunity to enter a short trade.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!

Good luck!

Christian Tharp, CMT