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Tickers in this Article: WMT, AMZN, BBY, TGT, SHLD
The day after Thanksgiving has evolved into the official kick-off for the holiday shopping season. Black Friday, as it has become to be known, has turned into a spectacle, with shoppers camping out in front of the stores for days in the hope of getting their hands on an ever-elusive "door buster" item. Every year it seems that retailers compete to out-do each other. This year, Sears Holdings Corporation (Nasdaq:SHLD) took things up another notch by announcing it will open stores on Thanksgiving day for the first time in its 124-year history. With Black Friday increasing in popularity and magnitude each year, it has become even more important for these retailers to capture a larger slice of the pie. While the retail sector has seen a run the past couple of weeks, many of these "door duster" stocks are worth monitoring into Black Friday and next week to see how the markets react to the turnout.
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The discussion of Black Friday retailers has to begin with Wal-Mart Stores (NYSE:WMT). This is the store that typically sees the most traffic and is the scene of some of the largest Black Friday camp outs. WMT's stock is in a position where its reaction to Black Friday could make or break it this season. WMT is very close to an important resistance level near $56, and with a strong reaction it could easily clear this level and head higher. However, a poor reaction could send WMT under $53, which would signal further consolidation, or possibly even a reversal.


Source: StockCharts.com


The online equivalent to WMT would have to be considered Amazon.com (Nasdaq:AMZN ). This online retailer provides a great alternative to shoppers who don't want to brave the mobs at the brick and mortar stores on Black Friday. AMZN has already cleared resistance and is currently at all-time highs. While AMZN is probably too extended right now, this remains one of the strongest stocks and should be monitored by traders,


Source: StockCharts.com


Electronics giant Best Buy Co. (NYSE:BBY) is another door-buster stock that traders should keep an eye on. It has had a fantastic rally from its September lows, and is in the process of consolidating those gains. While it may need a little more time, BBY has already revealed a critical area for traders to monitor. If it can close above the $46 level, this could signal an end to the consolidation and continuation move higher. Traders should be on guard for a break below the $42 level, as losing this level would imply a deeper correction.


Source: StockCharts.com


Target Corporation (NYSE:TGT) is another stock that has gradually become quite popular as a Black Friday destination. TGT, much like AMZN, has already broken out ahead of the holidays and is likely too extended for initiating new positions. However, traders should monitor the $55 level in the case of a pullback as this area could provide some support. TGT could also struggle at the $58 level, which is where it peaked in May.


Source: StockCharts.com


We mentioned that Sears Holdings Corporation was opening a day early on Thanksgiving this year, and as a trader you have to wonder if the stock's dismal performance has anything to do with it. SHLD dropped 50% from May to July and has stayed near this level for the past five months. While it has formed a clearly defined trading channel, this stock is underperforming its sector. The most important level for traders to watch here is the $60 floor underneath its current base. A drop below this level could send current stockholders into a panic.


Source: StockCharts.com


Bottom Line
While it's difficult to guess the impact that a single shopping day will have on these stocks, Black Friday is certainly a driver and these stocks will likely see some movement on both the holiday Friday session, and then again early next week as market participants digest the weekend shopping results. Each of these stocks has important levels to monitor, and traders should be ready in case they move as a result of Black Friday. Preparation is the key for traders, and knowing where buyers and sellers may lie in wait is half the battle.

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At the time of writing, Joey Fundora did not own shares in any of the companies mentioned in this article.

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