Chart Advisor: Examining Target Corp.

From SIA Charts

1/ Target Corp. – (TGT)

2/ Candlestick Chart

3/ Point and Figure Chart

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Target Corp. – (TGT)

Courtesy of SIA Charts

Target Corporation is a major U.S. retailer known for offering a wide variety of products at competitive prices. Despite the allure of Target's seemingly discounted stock price, investors appear to be anticipating more challenging times ahead. Let's delve into the technical aspects of TGT stock, starting with the SIA Relative Strength Matrix Report on the S&P 100. The report highlights two distinct periods: from 2019 to 2021, when Target excelled, and a current period of resistance in the Unfavored Red Zone since early 2022. So, it would be no surprise that the share price has performed poorly, both on an absolute basis and relative to leading stocks in the matrix. This situation underscores the opportunity costs compared to competitors like Dollarama, Walmart, Costco, and Ollie's Bargain Outlet (small cap).

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Candlestick Chart

The attached weekly candlestick chart, enhanced with the SIA Relative Strength Position overlay tool, color-codes TGT’s position within the SIA S&P 100 Matrix Report over time. This chart shows a Green Favored Zone period during which Target’s shares surged from $60 to $250. However, momentum waned, and the shares have since retraced from $250 to current levels around $135. The stock remains under significant selling pressure, with support at $110 and resistance at $170. This positions Target as a potential trading opportunity within this range, with a cautious eye on further declines below $110 or considering positions in stronger performers rather than potential “value traps.”

Courtesy of SIA Charts

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Point and Figure Chart

Point and figure charts offer a more precise view of support and resistance levels. Support is currently at $130.87, with additional support around $120.90. A breach of these levels could lead to a decline toward $101.17, aligning with the whole number $100. Resistance is at $144.49, with additional levels at $156.40. The key resistance zone, marked by the light pink box at $179.66-$183.25, is very strong. A move through this level would require a significant shift in both technical and fundamental sentiment compared to leading bargain retailers. With a SMAX score of 2 out of 10, Target is showing minimal short-term performance compared to other asset classes.

Courtesy of SIA Charts

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Originally posted 14th August 2024