My post several months back, at the October 2011 bottom, that Wal-Mart appeared to be on the cusp of finally breaking out was not particularly well-received. Since that post, though, WMT has seen a fairly strong move higher, especially considering how low beta the stock is. I still think Sam Walton’s pride and joy has plenty of room to go over the long haul.
In a similar vein, I believe Target is ripe for a major breakout. You can see the massive triangle on the monthly chart below. The recent shakeout down to $47 proved to be a false move, given the aggressive upside reversal back above those longer-term moving averages. Symmetrical triangles tend to work best to the upside when the bulls rip through them without taking too much time to meander through the apex. Here, Target is at that juncture where the strong move appears to have just commenced. Obviously, clearing $60 is a major hurdle. But I like Target’s prospects of following in Wal-Mart’s left-for-dead rally over the long run.