Walmart Inc. (WMT) is scheduled to announce its fiscal second-quarter earnings results on Tuesday before market open, but traders are not waiting for the release and the shares have surged to a new high.
We found the charts bullish in our last review on July 8 writing, "If any company can plan and execute a strategy to take business away from Amazon (AMZN) it would be Walmart. The charts and indicators of WMT are constructive. Trade from the long side risking a close below $118. Our price targets are the $145-$152 area."
Let's check out the charts again.
In the updated daily bar chart of WMT, below, we can see that the shares have made a new high with a small gap (price void) on the upside. Prices are breaking out of a smallish consolidation pattern from the early to mid-part of July.
The On-Balance-Volume (OBV) line is trying to hold around the June low of this indicator. It would give me more confidence if WMT rallied on strong volume and the OBV turned higher. The Moving Average Convergence Divergence (MACD) oscillator is crossing to the upside for a new outright buy signal.
In the weekly bar chart of WMT, below, we can see that prices have marched steadily higher the past three years and pullbacks/corrections have all been buying opportunities. Prices are above the rising 40-week moving average line.
The weekly OBV line shows improvement the past three months. The MACD oscillator is in a bullish alignment or configuration about the zero line.
In this daily Point and Figure chart of WMT, below, we can see that prices have broken out to new highs without a price gap (gaps are filled in on this kind of chart). A potential price target of $151 is projected.
Bottom-line strategy: Continue to hold longs in WMT as per previous recommendations. Raise stops to a close below $127. The $151-$162 area is our nearest price objective.
