WMT, TGT, and COST Forecasts – Weak Jobs Report Tests US Retail Resilience

WMT Technical Analysis

The early hours of trading on Monday feature Walmart drifting a little bit lower, but I think you have to look at this through the prism of a market that is going to remain very noisy. I think there are a lot of questions out there that people will be watching to figure out whether or not the US consumer is going to struggle after the weak jobs report on Thursday.

If anything, this should benefit Walmart over the longer term. All things being equal, this is a market that I do think recovers. This is the type of stock, though, that I prefer to scale into and hold for a longer period of time. The gap above has been pretty much filled. We’ll have to see, but Walmart is one of the first places Wall Street starts to look to if the consumer might be in trouble. So, I expect a challenge to the 200-day EMA fairly soon.

TGT Technical Analysis

Target is pretty flat at the beginning of the premarket trading. All things being equal, the 50-day EMA, I think, offers support. If we can break above the $132 level, I think Target looks good, and it is in a nice uptrend. Yes, we’ve had a pretty strong pullback, but this isn’t the first one.

COST Technical Analysis

Costco is reacting positively to a poor job report premarket on Monday, though we are a little soft. I think this is a buy on the dip type of scenario as well. Costco, of course, is a place where people go to save money, and therefore, it does make sense that there are concerns about the overall health of the US consumer. That being said, I’ve been hearing stories about the US consumer falling apart for 22 years, and it’s only happened a couple of times, and just for about 5 minutes each.

So, that’s a narrative that I don’t really pay too much attention to, but I think the nice candlestick on Thursday in reaction to that jobs report in Costco could be the beginning of an attempt to rally from here. A little bit of patience probably goes a long way. I wouldn’t jump into this one with a huge position either, but it certainly looks like it’s trying to turn things around.

If you’d like to know more about technical analysis and how traders use it, please visit our educational area.