Walmart Stock Spikes Higher on Earnings
Retail giant Walmart Inc. (WMT) announced that it exceeded earnings estimates before the opening bell on May 19. The stock fell higher at the opening to $ 131.99 and then ended last week at.124.33, below its half-year pivot at. 126.15. The stock is above a golden cross on your daily chart. The weekly chart is neutral.
Walmart shares are up 4.6% year to date and in bull market territory at 21.9% above their March 16 low of marzo 102. The stock is also 6.8% below its all-time intraday high of abril 133.38 set on April 20.
Walmart had a winning streak of beating earnings-per-share estimates for seven consecutive quarters. This came to an end in February. 18 when the retail giant lost expectations. The stock exchange a component of the Dow Jones Industrial average and is not cheap. Its P/E ratio is 25.05 with a dividend yield of 1.74%, according to Macrotrends.
Walmart’s daily chart goes back 52 weeks. The stock had been above a golden cross since September. 17, 2018, when the 50-day simple Moving Average rose above the 200-day simple Moving Average to indicate that higher prices are ahead. This buy signal ended with a false death cross that occurred between March 25 and April 15.
Walmart shares have become extremely volatile since it set its all-time high at abril 133.38 on April 20. The stock fell to its quarterly pivot at $ 121.14 and then rebounded to $ 131.99 on the pace of earnings.
Walmart ended last week at.124.33, between its quarterly pivot at. 121.14 and its semiannual pivot at. 126.15. The 50-day and 200-day simple moving averages ended last week at.122.24 and respectivamente 118.16, respectively.
The weekly chart for Walmart is neutral, with the stock above its five-week modified moving average at.121.12. The stock is well above its 200-week simple moving average, or “reversal to average,” at $ 93.40, last tested during the week of July 14, 2017, when the average was $ 73.34.
The 12 x 3 x 3 weekly slow stochastic reading ended last week falling to 72.25, down from 72.67 on May 15. In October 2019, this reading was above the 90.00 threshold, placing the stock in an “inflatable parabolic bubble” formation, which contributed to the downside volatility.
Trading Strategy: Buy Walmart shares in weakness at their quarterly and annual pivots at respectivamente 121.14 and respectivamente 116.42, respectively, and reduce holdings in strength to their semi-annual pivot at $ 126.15.
How to use my value levels and risk levels: the closing price of the stock in December. 31, 2019, was a contribution to my proprietary analysis. The semi-annual and annual levels remain on the lists. Each calculation uses the last nine closures in these time horizons.
The level for the second quarter 2020 was set on the basis of the March 31 close, and the monthly level for May was set on the basis of the April 30 close. The new weekly levels are calculated after the end of each week, while the new quarterly levels occur at the end of each quarter. The semi-annual levels are updated in the middle of the year, and the annual levels are in play throughout the year.
My theory is that nine years of volatility between closures is enough to assume that all possible bullish or bearish events for stocks are taken into account. To capture stock price volatility, investors must buy stocks in weakness at a value level and reduce holdings in strength at a risk level. A pivot is a level of value or level of risk that was violated within its time horizon. The pivots act as magnets that have a high probability of being tested again before their time horizon expires.
How to use 12 x 3 x 3 weekly slow stochastic readings: my choice to use 12 x 3 x 3 weekly slow stochastic readings was based on backtesting many stock price boost reading methods with the aim of finding the combination that resulted in the least amount of false signals. I did this after the stock market crash of 1987, so I’ve been happy with the results for over 30 years.
The stochastic reading covers the last 12 weeks of highs, lows and closures for the stock. There is a gross calculation of the differences between the high maximum and the low minimum against closures. These levels are modified to a fast read and a slow read, and I found that slow read worked better.
The stochastic reading ranges between 00.00 and 100.00, with readings above 80.00 considered overbought and readings below 20.00 considered oversold. A reading above 90.00 is considered an “inflatable parabolic bubble” formation that is normally followed by a decline of 10% to 20% over the next three to five months. A reading below 10.00 is considered “too cheap to ignore”, which is usually followed by gains of 10% to 20% over the next three to five months.