April 2, 2024 - The RightLine Report
Notes From The Editor
Romancing An Emotional Market
Do you ever get mad at the stock market? Lot's of traders do. Are there times that you feel like you really love it? You're not the only one. Almost everyone seems to adore the market when it's going up, and hate it when it's going down.
In fact, many traders relate to the stock market as if it were a living person. The daily price action becomes very personal to them. They act mistreated when things don't go their way, and then stop just short of sending flowers when the money-moments arrive. This type of love- hate relationship certainly comes at a high cost, both emotionally and mentally.
In reality the market doesn't care how we feel. It can't see us when we laugh, or hear us when we cry. It doesn't even know that we exist. The market won't try to help us, nor try to hurt us. It has no feelings at all. There is absolutely nothing we can do to control what it does, or even influence it in the slightest way.
What we CAN do is learn to control how we react to the market. This means that we have to first recognize our thoughts about the market and the feelings that motivate us to act. Anger, fear, greed, and even elation are a few of the basic emotions that often cause people to do things they regret. Complex emotions such as patience, caution, self respect, and relaxation usually result in better quality decisions.
Becoming too emotionally involved with the market can interfere with our ability to make rational decisions. These feelings usually are strongest at the precise moment we should be calm and clear headed. Emotion-management is a desirable and fortunately learnable skill. However, that doesn't meant we have to smother our feelings and become robot-like. It does mean we do have to examine and become aware of our own personal decision making process.
Self-examination allows us to understand how much of our judgment is based on emotional reactions, and how much rational thinking is involved. We have to first understand our personal traits before we can make improvements in our thinking process.
The key is balance. Being human, most of us allow way too much sentiment into the equation. While a strong passion for trading is certainly desirable, success in the stock market depends on our ability to blend our naturally reactive emotions with intentional reasoning.
Trade well,
- Thomas Sutton, Editor
Stocks Covered Today Stock Splits
Quick List
Stock 04/02 04/02 Buy Short Trailing Stops Gain
Symbol Price +/- Entry Entry Initial/Tighten Amount
------ -------- -------- -------- -------- --------------- --------
JAKK 22.92 -0.57 23.52 22.03 1.49/0.75 3.16
LENZ 21.01 0.00 21.88 1.78/0.89 2.5
CSTL 22.20 -0.05 22.58 1.84/0.92 3.4
CRGX 20.91 -0.72 21.61 19.28 2.33/1.17 7.32
IMNM 21.39 -0.72 22.55 20.3 2.25/1.13 4.08
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" and always use the RightLine Risk Control Calculator before entering any position.
For more on controlling risk go to the RightLine Risk Control System
For a glossary of terms unique to The RightLine Report go to: Glossary
Questions? Send us an email using our Contact Form.
Stocks Covered Today Stock Splits
Market Summary
Stocks continued their second-quarter slide on Tuesday as surging crude oil prices, a jump in Treasury yields to four-month highs, and diminishing optimism regarding prospects for interest rate cuts combined to dampen investor sentiment. Both the S&P 500 index (SPX) and the Nasdaq Composite (COMP) retreated to two-week lows.
Tesla (TSLA) shares plummeted by 4.9%, extending their year-to-date decline to 33%, following the company's report of an 8.5% year-over-year decrease in first-quarter vehicle deliveries. UnitedHealth Group (UNH) led the decliners in the Dow Jones Industrial Average, tumbling 6.4% after disappointing news of a prescription drug rate increase from the federal Centers for Medicare & Medicaid Services, which weighed on the health care sector. Retailer, biotechnology, and regional bank shares were among the weakest performers, contributing to a broad market decline where declining stocks outnumbered advancers by a ratio greater than three-to-one. The small-cap Russell 2000 Index (RUT) suffered a 1.8% loss, settling at a two-week low.
In contrast, energy companies continued their recent strength, buoyed by the ongoing climb in WTI Crude Oil futures, which surpassed $85 per barrel for the first time since late October. The Philadelphia Oil Service Index (OSX) advanced by 2.1%, closing at a 5 1/2 month high. Oil prices have surged this year due to OPEC production cuts and concerns over supply disruptions arising from the Middle East conflict.
Apr 1, 2024 Apr 2, 2024
-------------------- --------------------
Dow 39,566.85 -240.52 39,181.04 -385.81
Nasdaq 16,396.83 17.37 16,240.45 -156.38
S&P 500 5,243.77 -10.58 5,202.76 -41.01
NYSE Volume 3.33B 3.9B
NYSE Advancers 997 704
NYSE Decliners 1,843 2,128
Nasdaq Volume 4.82B 4.74B
Nasdaq Advancers 1,575 1,179
Nasdaq Decliners 2,732 3,100
New Highs/Lows
03/26 03/27 03/28 03/28 04/01 04/02
--------------------------------------------
NYSE New Highs 147 241 370 369 186 101
NYSE New Lows 33 12 12 12 23 38
Nasdaq New Highs 119 196 269 277 170 70
Nasdaq New Lows 126 78 50 49 81 134
Stocks Covered Today Stock Splits
TRADER'S TIP: "Behavioral Economics"
Dr. Daniel Kahneman - a professor at Princeton University - won the Nobel Prize for Economics in 2002. His studies in the field of behavioral economics reveal that investors are generally irrational, but predictably so. This is due to the fact they usually make the same mistakes again and again. One of the most repeated quirks is a common inability to take a loss. In fact, Dr. Kahneman's work shows that taking a loss is so painful to most people that they simply avoid it.
Rule One: Take losses while they're small, it's much easier that way.
The Technical Analyst
For help with this chart, be sure to read "Understanding The Importance Of Support And Resistance"
and "Improve Your Trading With Moving Averages".
Stocks Covered Today Stock Splits
Market Calendar
ECONOMIC REPORTS AND EVENTS (all times are Eastern): MONDAY, APRIL 1 9:45 am S&P U.S. manufacturing PMI (final) 10:00 am Construction spending 10:00 am ISM manufacturing TUESDAY, APRIL 2 10:00 am Factory orders 10:00 am Job openings 9:05 am Chicago Fed President Austan Goolsbee speaks 12:05 pm Cleveland Fed President Loretta Mester speaks 1:30 pm San Francisco Fed President Mary Daly speaks TBA U.S. auto sales WEDNESDAY, APRIL 3 8:15 am ADP employment 9:45 am S&P U.S. services PMI (final) 10:00 am ISM services 12:00 pm New York Fed President John Williams moderates discussion THURSDAY, APRIL 4 8:30 am Initial jobless claims 8:30 am U.S. trade balance 10:00 am Philadelphia Fed President Patrick Harker speaks 12:15 pm Richmond Fed President Tom Barkin speaks 12:45 pm Chicago Fed President Austan Goolsbee speaks 2:00 pm Cleveland Fed President Loretta Mester speaks FRIDAY, APRIL 5 8:30 am U.S. nonfarm payrolls 8:30 am U.S. unemployment rate 8:30 am U.S. hourly wages 8:30 am Hourly wages year over year 9:15 am Richmond Fed President Tom Barkin speaks 3:00 pm Consumer credit For a chart of typical Up or Down market reactions to specific major US economic reports go to: Economic Indicator Effects
Stocks Covered Today Stock Splits
TRADER'S TIP: "Mistakes"
"The greatest mistake you can make in life is to be continually fearing you will make one."
~ Elbert Hubbard
Stocks Covered in This Issue
CONSUMER CYCLICAL SECTOR
JAKKS Pacific, Inc. (JAKK: Consumer Cyclical/Leisure) - SQUEEZE PLAY. JAKK 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 23.52 and a SELL short entry at 22.03. Once your trade is filled, enter a 1.49 trailing stop. Tighten it to 0.75 after a 3.16 gain. JAKK closed on Tuesday at 22.92. Earnings Report Date: Apr 25, 2024. Beta: 2.37. Market-Cap: 247.499M. Optionable.
HEALTHCARE SECTOR
LENZ Therapeutics, Inc. (LENZ: Healthcare/Biotechnology) - BULLISH BOUNCE. LENZ's positive weekly uptrend is still intact despite recent selling that has driven share prices lower. Price action on Tuesday shows that traders are aware of the moving average support zone now in play, and they are ready to consider buying again. A shift up from this point will attract even more buyers. The new buying should move LENZ back in step with the bullish weekly trend, so our BUY entry trigger is set at 21.88. Once you hold a position, trail a stop of 1.78. Tighten it to 0.89 on a 2.5 gain. LENZ closed at 21.01 on Tuesday. Earnings Report Date: N/A. Beta: N/A. Market-Cap: 536.459M. Optionable.
Castle Biosciences, Inc. (CSTL: Healthcare/Diagnostics & Research) - BULLISH BOUNCE. The charts for CSTL show that despite the downward pressure from sellers recently, the weekly uptrend is still going strong. Buyers showed up again on Tuesday, resulting in the early stages of a rebound that started near moving average support. The resulting Bullish Bounce set-up offers a potential entry point for a long play. Set your trigger to BUY shares at 22.58, and follow your entry with a trailing stop of 1.84. Tighten it to 0.92 when a 3.4 profit is reached. CSTL ended the latest session at 22.20. Earnings Report Date: May 01, 2024. Beta: 0.90. Market-Cap: 609.39M. Optionable.
CARGO Therapeutics, Inc. (CRGX: Healthcare/Biotechnology) - SQUEEZE PLAY. The ticker for Tuesday's session shows CRGX 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 21.61 and a SELL short trigger at 19.28. When CRGX 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 2.33 trailing stop. Upon reaching a 7.32 profit, resize the stop to 1.17. Earnings Report Date: N/A. Beta: N/A. Market-Cap: 823.082M. Not Optionable.
Immunome, Inc. (IMNM: Healthcare/Biotechnology) - SQUEEZE PLAY. Tuesday's trading session left IMNM 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 22.55 and your SELL short trigger at 20.3. One of the orders will be triggered by upcoming price action. When your market order is filled, cancel the remaining trigger and enter a 2.25 trailing stop. Once you have a 4.08 profit, reduce the stop to 1.13. Earnings Report Date: May 03, 2024. Beta: 1.68. Market-Cap: 1.269B. Optionable.
IMPORTANT: Before entering any positions, always use the Risk Control System to determine the level of acceptable risk and the maximum number of shares to buy. Use Gap Adjusted Entries to reset the Entry Price for stocks that gap beyond recommended entry levels.
Stocks Covered Today Stock Splits
Stock Splits
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 (Effective 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.
Split details are also available online at the RightLine Online Stock Split Calendar. For a detailed look at the different stages of a Stock Split, Click Here.
A simple yet powerful tool, the Risk Control Calculator helps you manage risk by recommending a maximum number of shares to purchase. Available in the RightLine Member's Area.
Disclaimer
The RightLine Report is an information service for investors and traders. It is not a solicitation nor a recommendation or offer to buy or sell securities. The information provided is obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. The publishers of The RightLine Report are not brokers or financial advisors, and are not acting in any way to influence the purchase or sale of any security. Stock picks, entry points and exit points should be considered an information resource to assist the trader in developing a trading plan and it is the sole responsibility of the reader to conduct his or her own due diligence before executing a trade. Trading securities should be considered speculative with a high degree of volatility and risk.
The publishers of The RightLine Report recommend that anyone trading securities should do so with caution, exercise prudent trading discipline and have a personal risk management strategy in place before doing so. It is possible at this or some subsequent date, the publishers and staff of The Pro Right Line Corp. may own, buy or sell securities presented. The Pro Right Line Corp. is not a financial advisory service. Its publishers, owners or investors, are not liable for any losses or damages, monetary or otherwise, that result from the content of The RightLine Report. Past RightLine Report performance may not be indicative of future performance.
All subscriptions and/or use of the RightLine.net website are subject to RightLine's "Terms of Use" and "Subscriber Terms & Conditions" which are posted at www.rightline.net.
Any REDISTRIBUTION of the above information, without The RightLine's written consent, is STRICTLY PROHIBITED.
Copyright / The Pro Right Line Corporation - All Rights Reserved
Click Here To Unsubscribe