WMT breaks below Tuesday's low
Walmart Inc. (WMT) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
WMT ended Wednesday at 136.26 losing $1.10 (-0.8%), underperforming the Dow Indu. (0.13%). The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 136.68, Walmart confirmed its breakout through the previous session low after trading up to $0.63 below it intraday.
Daily Candlestick Chart (WMT as at Sep 16, 2020):
Wednesday's trading range has been $2.63 (1.9%), that's below the last trading month's daily average range of $3.96. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for WMT.
Three candlestick patterns are matching today's price action, the Bullish Hikkake Pattern and the Last Engulfing Bottom Pattern which are both known as bullish patterns and one bearish pattern, the Black Candle.
Prices are trading close to the key technical support level at 135.53 (S1). The market closed back below the 20-day moving average at 137.42. After having been unable to move above 139.08 in the prior session, the share ran into sellers again around the same price level today, missing to move higher than 138.68. The last time this happened on September 9th, WMT lost -2.20% on the following trading day.
While the stock is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could speed up should prices move below the close-by swing low at 135.55 where further sell stops might get activated.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Bottom Pattern" stand out. Its common bullish interpretation has been confirmed for Walmart. Out of 51 times, WMT closed higher 58.82% 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 56.86% with an average market move of 0.17%.