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Bearish JC Penney Technical analysis: 6000 jobs cut
24/02/2017
Bearish JC Penney Technical analysis: 6000 jobs cut

JC Penney plans to close up to 140 stores and to offer voluntary early retirement to 6,000 workers. Here is my Bearish JC Penney Technical analysis

24 February, AtoZForex – The JC Penney plans to shut 140 stores and offer voluntary early retirements to 6,000 workers as the store industry lags in the competition with online sellers. The company said to shutter 13 percent to 14 percent of its stores. Hence, the JCP share dropped 2.77 percent to 6.67 in pre-market opening hours. Moreover, the company have a market cap of 2.11 Billion and is about to touch its 52 week low of 6.35 points.

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Marvin R. Ellison, chairman and chief executive officer of J.C. Penney say

“We believe closing stores will also allow us to adjust our business to effectively compete against the growing threat of online retailers.”

Also he added, “By coordinating the timing of these two events, we can expect to see a net increase in hiring as the number of full-time associates expected to take advantage of the early retirement incentive will far exceed the number of full-time positions affected by the store closures.”

JC Penney Technical analysis

My weekly target for JC Penney is $6.30- 6.10 for today and 5.80- 5.70 for weekly or short-term basis. The technical indicators and moving averages signify strong sell signal for the JC Penney on the daily, weekly and monthly basis. Most noteworthy, the relative strength index is 37.778 which is ‘SELL’ and STOCH(9,6) display value of 14.503 which means oversold. According to Moving average convergence and divergence analysis MACD (12,26) value is -0.690 gives ‘SELL’ signal. In addition, the ultimate oscillator indicator display value of 32.165 which again signify ‘SELL’. The ATR(14) shows the JC Penney is highly volatile and value is 0.80.

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The EMA 100 is above the EMA 50 line which means the stock is highly bearish. Furthermore, the classic support and resistance levels are S3 6.30, S2 6.60, S1 6.82 and R1 7.34, R2 7.64, R3 7.86. All the indicators display ‘SELL’ signal and the stock is highly bearish in the mid-term and long-term.

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