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Ninja Trader Chart of the Day 5.17.13


Perhaps one of the largest of these companies, Wal-Mart ($WMT), has been under some scrutiny lately with earnings reports coming in short of projections and the recent factory fire in Bangladesh claiming more than 1,100 lives.

Since the incident, many clothing retailers that are large buyers in Bangladesh have inked safety contracts binding them to independent safety inspections with public reports. This contract also holds the retailers responsible for the cost of needed repairs. PVH ($PVH), a company that provides clothing for Calvin Klein, Tommy Hilfiger, and Izod brands is one of the few companies that signed the contract last year. Now pressure is on retailers such as Wal-Mart ($WMT), Gap Stores ($GPS) and Sears ($SHLD) to come to an agreement regarding safety contracts. Although all of these companies can agree that measures should be taken to prevent a future tragedy, it is not yet clear what positions each of these companies will take and what the effects will be when shareholders are updated with this news.

A relative strength index (RSI) indicator has been added to today’s NinjaTrader chart of the day and is plotted in green beneath Wal-Mart ($WMT) price action. As Q1 came to a close, the RSI was showing some signs that Wal-Mart ($WMT) may be overbought, providing some investors a selling point for their Wal-Mart ($WMT) holding. However, the retail giant continued to climb to new year highs the beginning of the second quarter and the RSI has dropped back to a normal range. Wal-Mart ($WMT) has slowed down in momentum in this time though and could potentially be broken by news in Bangladesh and a plan to move forward coupled with the lack-luster earnings news investors recently received.

Will these retailers and others continue their steady climb of 2013 or will agreements surrounding Bangladesh squash this remarkable bullish run? News surrounding the factory fire, safety regulations and costs for both will play a key role in the coming months for these markets. Stay on the winning side of the market with powerful tools and unfiltered data offered from NinjaTrader and Kinetick!


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