Looking at the March report for February US Retail Sales numbers we find the current level of sales at 445.66B, down from 446.71B last month. This represents a monthly annualized growth rate of -2.82%, compared to a long term average annualized growth rate of 4.17%. Is this a blimp or is the first data point signaling a coming problem for retailers? Consequently, with that question in mind, I set out to scan retailer stock charts to look for any clear Elliott Wave patterns that may provide an opportunity to exploit any mispricing. It didn't take me long to find one that appears relatively clear. Target Corporation (NYSE: TGT) appears to have completed an impulsive 5 wave move to the downside from the $90.39 high of 9/10/2018.

The subdivision from the September highs are clearly in 5 waves. As Elliotticians we would look for a corrective structure to follow. This would place the probabilities on our side that we should see another swing to the downside once a correction was complete.

Elliott Wave

From the $60.15, wave (a), lows of December 24, 2018, TGT appears to have progressed higher in a double-three pattern. The most recent high is the $81.56 print on 3/28/2019. If we indeed turn from there we know that we should take out the $60.15 low, but how low could TGT extend?

I want to be clear and state that we have no confirmation of a top at the March 28th high. But, if we aggressively call a top in place at that $81.56 high then we would look for a symmetrical move in wave (c) relative to the length of (a). This targets $51.35. Can it go that low?

We'll be looking for a short term bearish sequence to develop from $81.56 to start the confirmation process. 

(Click on image to enlarge)