WMT breaks back below 20-day moving average
Walmart Inc. (WMT) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, WMT ended the week -1.28% lower at 124.33 after losing $0.66 (-0.53%) today, slightly underperforming the Dow Indu. (-0.04%) ahead of tomorrow's Memorial Day market holiday. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (WMT as at May 22, 2020):
Friday's trading range has been $1.58 (1.26%), that's below the last trading month's daily average range of $2.62. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for WMT.
Walmart closed back below the 20-day moving average at 124.44. When this moving average was crossed below the last time on Tuesday, WMT actually gained 0.40% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling might speed up should prices move below the close-by swing low at 121.30 where further sell stops could get triggered. As prices are trading close to May's low at 120.78, downside momentum might accelerate should the market mark new lows for the month.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Walmart. Out of 293 times, WMT closed higher 58.70% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 59.39% with an average market move of 0.61%.