TJX Companies (TJX) presents a compelling dual-phase trading opportunity. The stock is poised for a significant correction, followed by a potential reversal at critical support levels. Traders and investors can benefit from both the downside and the eventual recovery using this detailed action plan.
Action Plan:
Phase 1: Short the Decline 📉
Technical indicators suggest TJX is heading into a corrective phase. The price is set to retrace to its major Fibonacci levels and historical supports.
- Short Sell Entry Zone: $115–$120
- Stop Loss: $125
- Profit Targets for Short Sell:
- Target 1: $90
- Target 2: $70
- Target 3: $50
- Why Short?
TJX is showing signs of bearish divergence with weakening momentum. A correction to $70–$50 aligns with historical levels and Fibonacci retracements, presenting a prime shorting opportunity.
Phase 2: Prepare for the Reversal 📈
Once the correction stabilizes near $50, TJX is expected to recover, backed by strong fundamentals and technical rebound signals.
- Buy Zone for Long Position: $45–$55
- Stop Loss: $40
- Profit Targets for Long:
- Take Profit 1: $90 ✅
- Take Profit 2: $110 🚀
- Take Profit 3: $130 🎯
- Why Buy?
TJX’s resilience in the retail sector and its historical performance indicate a strong recovery potential post-correction. The $45–$55 range has acted as a robust support zone, offering a low-risk entry for a long-term position.
Key Takeaways:
- Short-term Strategy: Profit from the anticipated decline by shorting near $120, targeting the $50 range.
- Long-term Strategy: Re-enter on the reversal near $50, with significant upside potential toward $130.
- Disciplined stop-loss placement is critical to minimize risk during volatile conditions.
Disclaimer
This post is for informational purposes only and does not constitute financial advice. Trading and investing involve risks, including the potential loss of principal. Always conduct thorough research and consult with a licensed financial advisor before making any trading or investment decisions.
Position yourself strategically in TJX’s correction and recovery phases to maximize your trading edge. With proper execution, this two-phase approach could yield substantial returns.