Target on the Verge of a Double-Digit Plunge

Target broke from a triple-bottom, and the sell-off appears set to continue


Target (TGT) — This retail giant, which operates over 1,900 stores in the U.S. and Canada, has been hurt by a massive security breach. A recent investigation found that “certain guest information, separate from the payment card data previously disclosed, was taken during the breach.”

Based on an expected 2.5% decline in comparable store sales, the company lowered its adjusted Q4 earnings estimates to a range of $1.20-$1.30 versus prior guidance of $1.50-$1.60.

The stock was not acting well even before the database breach. It broke down in August on a price gap at about $68, and for four months appeared to be forming a base. However, on Jan. 14, TGT broke from a triple-bottom and looks to be headed much lower. A base at about $50 appears on the weekly charts, so that is my downside target.

Sell TGT short with a stop-loss order at $64. Short-selling is a speculative technique that should only be used by traders willing to accept the risks. Check with your broker for any special requirements.

01 28 14 tgt 300x189 Target on the Verge of a Double Digit Plunge
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chart key 300x84 Target on the Verge of a Double Digit Plunge

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