Wal-Mart Stores Inc. (NYSE:WMT) is the largest retailer in the world, and if they are have problems, then we really have to examine and be concerned about what is really happening to the economy.
Yesterday, it was reported that Wal-Mart stores were cutting back on U.S. orders amid an inventory backlog. It was later denied by David Tovar a spokesperson for Wal-Mart. However, true or false it managed to push the stock of Wal-Mart down over 2% on the day.
That is a fundamental viewpoint. What is interesting technically about Wal-Mart is the fact that it recently broke below a 25 month trend line.Trend lines are enormously important for determining the momentum and trends of stocks, commodities, and any number of items that can be charted. In order to be a valid trend line, it must touch three points along the line to be truly meaningful. The longer the time frame, the more meaningful and powerful the trend line becomes. A two year trend line like Wal-Mart recently broke thru to the downside is significant and should not be ignored.