Daily Stock for Pre-Market Prep: Walmart – Wal-Mart Stores (WMT)
Whether or not you follow analysts’ price target adjustments, their actions have an impact on an issue’s price, especially in the short term.
Ahead of Tuesday’s opening, Goldman Sachs maintained its buy rating on Walmart inc. (NYSE: WMT) and raised the price target from $ 184 to $ 196. The stock was also added to the company’s condemnation buying list.
The corresponding price action makes it the PreMarket Prep action of the day.
The establishment: Walmart participated in the recent general market rally. The show hit a low of $ 134.71 on Oct. 4, along with the S&P 500, and entered Tuesday’s session on a three-day winning streak.
On Monday, Walmart closed at its highest level since September 28 at $ 141.68. It should be noted that the problem was about to explode to the upside as it had hit four daily highs in the $ 142 area since September 28. That group included Monday’s high of $ 142.01.
Aggressive pre-market buyers: With analyst action taking place overnight, traders had to wait until the pre-market opened (4 a.m.) to buy shares from the show. In fact, its low in the pre-market ($ 143) was not revisited in the regular session.
Buyers beware: Although the problem was with an open sharply higher around $ 145, early buyers still had a chance to profit on the long side, but they had to be quick to exit. After a significantly higher open ($ 144.63 vs. $ 141.68), the show topped the pre-market high ($ 145), reaching $ 145.61 and reversed sharply.
Within five minutes it was back below $ 145 and heading much lower. Once the issue passed the opening price, the pace of decline accelerated. At 12:40 p.m. EST, $ 143.66 was the session low and slipped into the $ 144 grip.
Moving forward: Investors who regret not owning the show before the price target change should focus on the $ 142 area. The reason is that it would fill the vacuum (or the price vacuum), initiated by Goldman Sachs.
If one is to follow one of the basic principles of technical analysis – that old resistance becomes new support – then $ 142.01 can be a potential support area.
Benzinga’s PreMarket Prep airs every morning from 8 a.m. to 9 a.m. ET. During this fast-paced and highly informative hour, traders and investors tune in to get the top news for the day, the catalysts behind these moves, and the corresponding price action for the upcoming session.
Each day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick as well as producer Spencer Israel.