Walmart : First bullish signal! Possible END of the retracement!Walmart (officially WalMart, Inc.), the multinational retail corporation based in the United States, has an impeccable technical outlook, as we recalled in a previous post.
Its trend is clearly bullish (Bull), but on December 9th (red vertical line), it began a retracement phase due to the significant accumulated increase it had experienced. The price has retraced to the first key zone of 89-90 (23.6% Fibonacci) and, for now, has respected it. If it breaks below that zone, the price could fall to around 85 (38.2% Fibonacci).
On January 6th, the FIRST bullish (Bull) signal appeared on the chart, and the price closed yesterday in an important zone, which, if surpassed, could mark the end of the correction and the beginning of a new bullish impulse toward NEW HIGHS. We need to be attentive because a H4 candle close above 92 would give us a clear signal to enter long (Bull).
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Strategy to follow:
ENTRY: We will open 2 long positions if the H4 candle closes above 92.
POSITION 1 (TP1): We close the first position at the highs zone of 95.8 (+4.2%).
--> Stop Loss at 88.5 (-3.5%).
POSITION 2 (TP2): We open a Trailing Stop position.
--> Initial dynamic Stop Loss at (-3.5%) (matching the 88.5 of position 1).
--> We adjust the dynamic Stop Loss to (-1%) when the price reaches TP1 (95.8).
SETUP CLARIFICATIONS
*** How to determine which 2 long positions to open? Let’s take an example: If we want to invest 2,000 euros in the stock, we divide that amount by 2, and instead of opening 1 position of 2,000, we will open 2 positions of 1,000 each.
*** What is a Trailing Stop? A Trailing Stop allows a trade to continue gaining value when the market price moves in a favorable direction but automatically closes the trade if the market price suddenly moves in an unfavorable direction by a determined distance. That determined distance is the dynamic Stop Loss.
--> Example: If the dynamic Stop Loss is at -1%, it means that if the price drops by -1%, the position will be closed. If the price rises, the Stop Loss also rises to maintain that -1% during the increases, thus reducing the risk until the position becomes profitable. This way, one can take advantage of very strong and stable price trends, maximizing profits.
