Target’s forming an Inverse Head and Shoulders?

Published on Thursday, 14 January 2010 09:44 Written by Gerard Lerod

New York, Jan 14^th (TradersHuddle.com) – Shares of Target (NYSE:TGT) were trading higher in the early trading session, exhibiting relative strength on an otherwise weak overall market. This after the retailer announced that its resuming its $10 billion share buyback program as business is improving. At the end of the third quarter, Target had acquired 95.2 million shares for about $4.9 billion, or half of the amount authorized by the company's board in late 2007. Executives expect to complete the program in two or three years.

Target stores offer everyday essentials and fashionable differentiated merchandise, its credit card operations represent an integral component of its core retail business, strengthening the bond with its guests, driving incremental sales and contributing meaningfully to earnings.

Target shares appear to be forming an inverse head and shoulders pattern, based on the distance from the neckline to the head the measured move in the stock could reach the $55 area. Traders will be looking at the price action to see if the head and shoulders pattern triggers.

Disclosure: Writer doesn’t have any position in Target