Target's Near Term Price Target to $45 Looking for Support
Target ($TGT) Monthly: Target is getting smacked in kind with rest of the retail/grocers after today's announcement of Amazon's ($AMZN) buy out of Whole Foods ($WFM). When companies like Kroger ($KR) are experiencing these kinds of slashing downside moves, it's a good idea to take a breather and stay out of these stocks and let things settle out, instead of falling in to the temptation of guessing the bottoms and picking prices because they've come down so much in such little time. Just because a stock has had a 10-20% move PER DAY doesn't mean it can't go lower - in fact, when broad market/sector conditions are disrupted, the tendency is for people to hit the exits, and not catch falling knives. I've expressed these views on reddit to some folks who are itching to get in these stocks today.
Target shows a long term support at around $45 level, as shown in the monthly chart below. Looking at the RSI and MACD, i would expect this support to be tested in the near term, which means $TGT has further room to the downside. This also represents the .618 fib level. Having broken down from a multi-year channel from 2009 to beginning of 2017, i would expect price pass the .5 fib level (which it did) and extend to the .618 level given the technicals show more room to go. As always, watch the RSI and MACD to support higher moves in price, as indication that it may be turning around and headed higher. Right now, that's just not the case. Caution is recommended.
Target shows a long term support at around $45 level, as shown in the monthly chart below. Looking at the RSI and MACD, i would expect this support to be tested in the near term, which means $TGT has further room to the downside. This also represents the .618 fib level. Having broken down from a multi-year channel from 2009 to beginning of 2017, i would expect price pass the .5 fib level (which it did) and extend to the .618 level given the technicals show more room to go. As always, watch the RSI and MACD to support higher moves in price, as indication that it may be turning around and headed higher. Right now, that's just not the case. Caution is recommended.