Daily 4XSetUps - Bloodbath for 3M Of Almost -10% This Week

2024/10/27
Daily 4XSetUps - Bloodbath for 3M Of Almost -10% This Week
“bloodbath! long-term uptrend end? just medium-term correction?”


The US conglomerate MMM presented mixed results in the third quarter of 2024. Sales stagnated at just under $6.3 billion, while adjusted earnings per share rose 18 percent to $1.98, beating analyst expectations. Despite an operating loss due to legal costs, management remained confident and raised its full-year profit forecast. However, the market, i.e. the majority of traders and/or investors, punished the share brutally. I didn't expect such a reaction - on the contrary! You? The price action in the past week went from just over USD 141 (Monday) to under USD 123 (Friday) - which resulted in a devaluation of the share by USD 18. A bloodbath! no question? CEO William Brown emphasizes the strong operational performance and robust cash inflows. For the full year, MMM now expects adjusted earnings per share of $7.20 to $7.30, an increase from the lower end of its previous forecast. Sales are expected to increase by around one percent. Investors on the stock market initially reacted positively to the news, but the shares fell slightly over the course of the day.

“The more you think you know, the more closed-minded you’ll be.”
Ray Dalio

MMM reported negative operating cash flow of $1.8 billion - higher than expected negative $1.57 billion. Adjusted free cash flow, on the other hand, was a solid $1.5 billion. What, for better or worse, could be the reason for this sharp downfall for the shares, last calendar week!? At least for the rest of the year?! whatever? We'll still stick with MMM !

The shares closed at $124.75 on Friday.
Which was a weekly loss of almost -10%. Therefore the share is more than damaged! Are we not kidding ourselves? What is crucial now is that the 119.31 USD holds. Because there are, at least from a technical analysis perspective, no major price action areas where support could lurk for us bulls! Except 112.96 USD? The penultimate quarterly results more than convinced the market. And the stock opened with a bullish GAP from 103.39 USD. Therefore, be sure to adhere to the stop price of 111 USD! If not, pull the ripcord beforehand? To protect yourself from emerging losses. However, I don't want to send you into this week feeling hopeless! And I wanna end this post with some good outlook! What? Is there hope for this long 3M 4XSetUp? Yes! If the share stabilizes above 119.31 USD over the course of the week. So that we can tackle the 132.96 USD during the next month of November 2024. What if traders and investors push the shares back above 132.96 USD? And after the shares did not fall below 119.31 USD? Then we would have a nice bullish trend reversal formation in the stock! But that takes time - let's give ourselves, the stock, all traders and investors this time, until at least the end of this year 2024! Then we'll see what happens next?


With best wishes
and with good intentions!
Aaron



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