SIA Chartsā relative strength rankings help investors manage risk by identifying stocks and sectors which are relatively underperforming in the short or long term to potentially be avoided as capital appears to be seeking better opportunities elsewhere.
Target Corp. (TGT), which plunged 9.0% yesterday following a disappointing earnings report, has long been a relative weakling among US large cap stocks. The shares really havenāt been the same since they staged a big plunge down the rankings in the SIA S&P 100 Index Report back in May of 2022. They have not been back in the green zone since and have spent nearly all of the last two years stuck in the Red Unfavored. Zone.
Target has provided a reminder that promising recovery plays donāt all follow through to a positive conclusion, many fail. TGT peeked up into the yellow zone back in March but stalled out and had rolled back down into the Red Unfavored Zone prior to the earnings release, a possible sign of investors anticipating the potential for trouble ahead.
Candlestick Chart Breaks Down. Target Corp (TGT) has started to really breakdown this week, falling below $150.00. The shares had already been under distribution falling away from a high near $180.00 back in April. In recent weeks, the shares had snapped an uptrend line and dropped back under their 10-week moving average, both bearish signs, and established a new downtrend of lower highs.
This week, TGT has sold off on a jump in volume confirming increased selling pressure and the start of a new downtrend. Next potential support based on previous lows appears near in the $130.00-$135.00 area, then closer to $120.00. Initial resistance appears near the $150.00 round number.
Point and Figure Chart Turns Downward. In early April, Target Corp (TGT) had been looking pretty good technically. The shares had broken out of a long-term downtrend, rallied to their highest level since early 2022, and were on a bullish catapult. Unfortunately it was all downhill from there. In the last month, the shares have completed two bearish Double Bottom breakdown and a Bearish Catapult, signaling the start of a new downtrend.
Next potential support appears in the $134.60 to $137.30 zone where horizontal and vertical counts, and previous column lows converge, followed by previous lows near $123.05. Initial resistance on a rebound appear near $150.00 where a 3-box reversal and a round number converge.
With its bearish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of 3 out of 10, TGT is exhibiting short-term weakness against the asset classes.
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