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April 18, 2023 - The RightLine Report
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NOTES FROM THE EDITOR
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Several years ago a friend called to tell me that his father had just survived a private plane crash. It seems that although his dad had logged more than 40,000 hours as a pilot, he was testing a new GPS system with a series of touch and go landings and forgot to lower his landing gear on the final approach.
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"QUICK LIST"
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Stock 04/18 04/18 Buy Short Trailing Stops Gain
Symbol Price +/- Entry Entry Initial/Tighten Amount
------ -------- -------- -------- -------- --------------- --------
K 67.76 0.13 68.7 3.41/1.71 1.72
CRT 20.58 0.12 20.85 19.44 1.41/0.71 2.8
ELV 483.08 -1.19 491.16 26.21/13.11 22.2
ZIM 21.53 -0.03 22.17 20.66 1.51/0.76 2.26
AI 22.76 -0.02 23.59 21.58 2.01/1.01 4.18
The "Quick List" provides a brief summary of each stock write-up and should be taken in the context of the related write-up presented in the "Stocks Covered in This Issue" section of this Report. Be sure to read "How To Use The RightLine Quick List" at https://prorightline.com/index.php/rightline-report-quick-list/. In addition,always use the RightLine Risk Calculator before entering any position. For access to the Risk Calculator, go to https://prorightline.com/index.php/risk-calculator/. To learn more about controlling risk go to the RightLine Risk Control System at https://prorightline.com/index.php/rightline-risk-control-system/ For a glossary of terms unique to The RightLine Report go to: https://prorightline.com/index.php/glossary/ Questions? Send us an email using our contact form at: https://prorightline.com/index.php/contact-us/
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MARKET SUMMARY
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he major US stock indices were mixed on Tuesday as the market contemplated challenges to the economy and banking sector. JPMorgan Chase (JPM), Bank of America (BAC), Citigroup (C), and Wells Fargo (WFC) all reported better quarterly earnings results than analysts exepected, yet the surprisingly strong announcements haven't erased concerns about damage done by the turbulence that hammered parts of the banking sector earlier this year. Oil and Bitcoin were higher, gold and the yield on a 10-year treasury note were lower. Apr 17, 2023 Apr 18, 2023
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Dow 33,987.18 100.71 33,976.63 -10.55
Nasdaq 12,157.72 34.26 12,153.41 -4.31
S&P 500 4,151.32 13.68 4,154.87 3.55
NYSE Volume 3.63B 3.56B
NYSE Advancers 1,835 1,374
NYSE Decliners 1,161 1,617
Nasdaq Volume 4.86B 4.89B
Nasdaq Advancers 2,775 1,981
Nasdaq Decliners 1,688 2,483
New Highs/Lows
04/11 04/12 04/13 04/14 04/17 04/18
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NYSE New Highs 48 57 54 46 56 66
NYSE New Lows 20 28 31 40 39 34
Nasdaq New Highs 71 80 86 71 81 74
Nasdaq New Lows 120 192 157 222 170 152
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TRADER'S TIP:
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TRADER'S TIP: "Bull or Bear?" Some traders will buy a stock and immediately become very bullish, while others will sell short and then become very bearish. Whether you are a bull or a bear, never let your holdings do your thinking for you. Always remain unbiased. Your only prejudice in the market should be against being wrong. **************************
THE TECHNICAL ANALYST
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This section contains important technical data for the three major market averages -- the S&P 500, the Nasdaq Comp Index, and the Dow Industrial Average. For guidance on how to use this information, go to: https://prorightline.com/index.php/technical-analyst-section-rightline-report/ S&P 500 - 4154.87 April 18, 2023 52-Week High: 4512.94 52-Week Low: 3491.58 Daily Trend: UP Weekly trend: UP Weekly Pivot Levels Resistance 3: 4305.73 Resistance 2: 4215.09 Resistance 1: 4176.37 Pivot: 4124.46 Support 1: 4085.73 Support 2: 4033.82 Support 3: 3943.18 https://www.prorightline.com/rlch/041823SPX.jpg--ECONOMIC REPORTS AND EVENTS (all times are Eastern): WEDNESDAY, APRIL 19 2:00 pm Fed Beige Book 7:00 pm New York Fed President Williams speaks THURSDAY, APRIL 20 8:30 am Initial jobless claims April 15 8:30 am Continuing jobless claims April 8 8:30 am Philadelphia Fed manufacturing survey April 10:00 am Existing home sales March 10:00 am U.S. leading economic indicators 12:00 pm Fed Gov. Christopher Waller speaks 12:20 pm Cleveland Fed President Loretta Mester speaks 3:00 pm Dallas Fed listens with Dallas Fed President Lorie Logan and Fed Gov. Michelle Bowman 5:00 pm Atlanta Fed President Raphael Bostic speaks FRIDAY, APRIL 21 9:45 am S&P flash U.S. services PMI April 9.45 am S&P flash U.S. manufacturing PMI April 4:35 pm Fed Gov Lisa Cook speaks For a chart of typical Up or Down market reactions to specific major US economic reports, go to "Economic Indicator Effects" at this link: https://prorightline.com/index.php/economic-indicator-effects/
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TRADER'S TIP:
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TRADER'S TIP: "The Two Basic Types of Technical Indicators" Technical indicators use math calculations to measure the relationship of current price action to previous prices. Most indicators fall under one of two categories - Trend-Following or Oscillators. Moving Averages and MACD are two well-known trend-following indicators, while Stochastics and RSI are both popular Oscillators. Trend-Following indicators react slowly, and look far into the past to help uncover the future. On the other hand, Oscillators respond quickly to short-term price fluctuations, moving up and down between Overbought and Oversold conditions. There are advantages and disadvantages to each type of indicator, so it is best to use indicators from both groups. This allows the negative features to offset each other while leaving the positive aspects intact. ***********************************
STOCKS COVERED IN THIS ISSUE
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CONSUMER DEFENSIVE SECTOR Kellogg Company (K: Consumer Defensive/Packaged Foods) - BULLISH BOUNCE. Some people hear of a stock that's performing nicely and then buy it without any regard for timing the entry. This approach usually leaves money on the table, money that could just as well be added to profits. The Bullish Bounce setup provides a well timed entry and reduces exposure to risk by placing both the entry trigger and exit stop near the bottom of the bounce. We have an opportunity to use this approach with K which met our setup criteria on Tuesday. The BUY trigger for this trade is at 68.7, and the trailing stop is sized at 3.41. Resize the stop to 1.71 upon collecting a 1.72 point gain. K closed Tuesday at 67.76. Earnings Report Date: May 04, 2023. Beta: 0.42. Market-Cap: 23.219B. Optionable. ENERGY SECTOR Cross Timbers Royalty Trust (CRT: Energy/Oil & Gas E&P) - SQUEEZE PLAY. The ticker for Tuesday's session shows CRT is now stuck in a tight price band. With the cyclical contraction and expansion nature of volatility in force, we should see a new period of price expansion in the days ahead. To improve the odds of catching the next directional wave, place a BUY trigger at 20.85 and a SELL short trigger at 19.44. When CRT starts moving out of its narrow range, your order will be triggered. Once you're in the trade, cancel the opposing trigger and set a 1.41 trailing stop. Upon reaching a 2.8 profit, resize the stop to 0.71. Earnings Report Date: N/A. Beta: 0.77. Market-Cap: 123.48M. Not Optionable. HEALTHCARE SECTOR Elevance Health, Inc. (ELV: Healthcare/Healthcare Plans) - BULLISH BOUNCE. Entering a position in the early stages of a bounce is great way to get on board an up-trending stock. The "Bullish Bounce" setup identifies probable candidates by evaluating the trading action that takes place near support levels. ELV's behavior on Tuesday could very well be a sign that a new bounce is underway. Place a BUY trigger at 491.16. In the event your trigger is met, also place a 26.21 trailing stop which can be trimmed down to 13.11 when you have a 22.2 profit. ELV closed Tuesday at 483.08. Earnings Report Date: Apr 19, 2023. Beta: 0.85. Market-Cap: 114.711B. Optionable. INDUSTRIALS SECTOR ZIM Integrated Shipping Services Ltd. (ZIM: Industrials/Marine Shipping) - SQUEEZE PLAY. Tuesday's trading session left ZIM in a very narrow price range after buyers and sellers fought to a near stalemate. Both sides are looking for some traction, and a breakout either way could provide a nice gain in the short term. To get aboard, set your BUY trigger at 22.17 and your SELL short trigger at 20.66. One of the orders will be triggered by upcoming price action. When your market order is filled, cancel the remaining trigger and enter a 1.51 trailing stop. Once you have a 2.26 profit, reduce the stop to 0.76. Earnings Report Date: May 15, 2023. Beta: 1.96. Market-Cap: 2.588B. Optionable. TECHNOLOGY SECTOR C3.ai, Inc. (AI: Technology/Software-Application) - SQUEEZE PLAY. AI is stuck in a Bull/Bear deadlock. Fortunately for traders this impasse should be resolved soon, with one side or the other taking control. We want to be positioned for a potential quick move up or down, so get ready to catch this train with a BUY entry at 23.59 and a SELL short entry at 21.58. Once your trade is filled, enter a 2.01 trailing stop. Tighten it to 1.01 after a 4.18 gain. AI closed on Tuesday at 22.76. Earnings Report Date: May 30, 2023. Beta: 1.61. Market-Cap: 2.554B. Optionable. IMPORTANT: Before entering any recommended positions, always use the RightLine "Risk Control System" to determine the level of acceptable risk and the maximum number of shares to buy. Link: https://prorightline.com/index.php/rightline-risk-control-system/ Use "Gap Adjusted Entries" to reset the Entry Price for stocks that gap beyond recommended entry levels. Link: https://prorightline.com/index.php/gap-adjusted-entries-increase-profits/ ***********************************
STOCK SPLIT SUMMARY
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Below are the stocks that have announced splits and have recently executed or will execute soon. There is generally a return to normal price behavior in the weeks following a split announcement in what we call a "Dormancy Phase." As the stock nears its split execution date it often moves into the "Pre-Split Run" stage where quick and sometimes dramatic gains can occur. Announce Eff. Split Company Name (Symbol) Date Date Ratio Options ---------------- ------- -------- ------- ------ ------- NOTE: The number of stock split announcments goes up during Bull markets, and goes down during Bear market cycles. There are currently no upcoming stock splits that meet RightLine's proprietary criteria for split ratio, trading volume and price action. For a closer look at the different stages of a Stock Split go to: https://prorightline.com/index.php/trading-stock-splits-stages/ ======================================================================
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