Notes From The Editor

Let's continue our recent discussion about brokerages. We're doing this from a swing-trader perspective, although several of these factors apply to anyone trading stocks online.

Commissions are one of the first considerations when you're choosing a brokerage firm. Fees, however, might be less obvious. Sometimes they're even hidden away in the fine print of your sign-up agreement. Things to watch out for include a minimum account fee (you'll be docked if your account goes under a certain level), a monthly maintenance fee, various service fees, platform fees, or settlement fees if you're trading on margin.

These can really start to add up, taking an unnecessary bite out of your account.

For most swing traders, one consideration that's probably further down the ladder is execution speed. In the scope of a trade that's been open for several days, the difference of penny or two won't make a substantial difference. So even though you might opt for using a specialized trading platform on your PC that ensures speedier execution and up-to-date quotes, it's not necessary. As long as their system is reliable, you can do just fine by using the brokerage's website to enter entry and exit stops.

People like stable companies when it comes to all matters financial, so not surprisingly, many traders naturally gravitate toward the big-name brokerages. These could very well be good choices, but be sure to do your due diligence first. Having a huge customer base can translate to shoddy customer service and overloaded trading systems.

On the same token, don't be scared to consider smaller brokerages that aren't household names. These sometimes offer the best combination of low commissions and solid customer service. The good ones will treat you less like a number and more like a valuable customer.

Online reviews are the best way to learn about a brokerage's performance. Put more emphasis on recent reviews, as they give a better indication of the company's current pros and cons. If you can't track down any informative reviews of a firm, you may want to steer clear and continue your search.

Finally, don't be afraid to ask friends who trade. Their trusted opinion can point you in the right direction - especially if it matches what people are saying online.

Here's to profits!

Kent Barton
Senior Analyst

Quick List

    
Stock     04/25     04/25      Buy      Short   Trailing Stops     Gain 
Symbol    Price      +/-      Entry     Entry   Initial/Tighten   Amount 
------  --------  --------  --------  --------  ---------------  --------

AEM       56.32      0.16     57.29                  3.51/1.76      2.94
MANU      21.00     -0.53     21.86     20.33        1.53/0.77      2.36
MRUS      20.19     -0.66     21.45     19.46           1.99/1      2.32
ZNTL      21.79      0.29      22.3     20.84        1.46/0.73      2.14

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.

Market Summary

US stocks fell hard on Tuesday following disappointing earnings reports from several companies, as the tech-centric Nasdaq Composite and the broader S&P 500 closed near their lowest levels in a month. Now that first quarter earnings season is underway, it appears the market is in a 'sell the news' mood, with even shares of companies that have topped expectations are being sold. Transportation stocks had a togh session after United Parcel Service(UPS) shares fell 10% after the delivery company failed to meet analysts' profit forecasts.In economic news, Consumer Confidence is down more than expected in April, as volatility expectations measured by the CBOE Volatility Index (VIX) have surged to a one-month high. Oil and the yield on a 10-year US treasury bond were lower, gold and Bitcoin moved higher.

                        Apr 24, 2023           Apr 25, 2023   
                  --------------------   --------------------
Dow                 33,875.40    66.44     33,530.83  -344.57
Nasdaq              12,037.20   -35.25     11,799.16  -238.05
S&P 500              4,137.04     3.52      4,071.63   -65.41

NYSE Volume                       3.3B                  3.99B
NYSE Advancers                   1,635                    497
NYSE Decliners                   1,331                  2,538

Nasdaq Volume                    4.86B                  4.82B
Nasdaq Advancers                 1,829                    998
Nasdaq Decliners                 2,601                  3,461

                                 New Highs/Lows

                   04/18  04/19  04/20  04/21  04/24  04/25
                 --------------------------------------------
NYSE New Highs        66     54     70     53     53     43
NYSE New Lows         34     33     34     39     40    103
Nasdaq New Highs      74     65     58     68     79     39
Nasdaq New Lows      152    140    149    201    211    385
   

TRADER'S TIP: "Choose Courage"

"Being a successful trader also takes courage; the courage to try, the courage to fail, the courage to succeed, and the courage to keep on going when the going gets tough."

~ Michael Marcus

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".

S&P 500 - 4071.63 April 25, 2023

52-Week High: 4325.28
52-Week Low: 3491.58
Daily Trend: DOWN
Weekly trend: UP
Weekly Pivot Levels
Resistance 3: 4250.19
Resistance 2: 4194.57
Resistance 1: 4164.04
Pivot: 4138.95
Support 1: 4108.42
Support 2: 4083.33
Support 3: 4027.71

NASDAQ Composite - 11799.16 April 25, 2023

52-Week High: 13181.09
52-Week Low: 10088.83
Daily Trend: DOWN
Weekly trend: UP
Weekly Pivot Levels
Resistance 3: 12618.79
Resistance 2: 12360.18
Resistance 1: 12216.32
Pivot: 12101.57
Support 1: 11957.71
Support 2: 11842.96
Support 3: 11584.34
        
Dow Industrials - 33530.83 April 25, 2023

52-Week High: 34712.28
52-Week Low: 28660.94
Daily Trend: DOWN
Weekly trend: UP
Weekly Pivot Levels
Resistance 3: 34516.86
Resistance 2: 34175.98
Resistance 1: 33992.47
Pivot: 33835.10
Support 1: 33651.59
Support 2: 33494.22
Support 3: 33153.34
 

Market Calendar

ECONOMIC REPORTS AND EVENTS (all times are Eastern):    

Wednesday, April 26, 2023:
26-Apr  8:30 am   Durable-goods orders
26-Apr  8:30 am   Durable-goods minus transportation
26-Apr  8:30 am   Advanced U.S. trade balance in goods
26-Apr  8:30 am   Advanced retail inventories
26-Apr  8:30 am   Advanced wholesale inventories
26-Apr  THURSDAY, APRIL 27   

Thursday, April 27, 2023:
27-Apr  8:30 am   GDP
27-Apr  8:30 am   Initial jobless claims
27-Apr  8:30 am   Continuing jobless claims
27-Apr  10:00 am   Pending home sales
27-Apr  FRIDAY, APRIL 28   

Friday, April 28, 2023:
28-Apr  8:30 am   Employment cost index
28-Apr  8:30 am   Personal income (nominal)
28-Apr  8:30 am   Personal spending (nominal)
28-Apr  8:30 am   PCE index
28-Apr  8:30 am   Core PCE index
28-Apr  8:30 am   PCE (year-over-year)
28-Apr  8:30 am   Core PCE (year-over-year)
28-Apr  9:45 am   Chicago Business Barometer
28-Apr  10 am   Consumer sentiment (final)

For a chart of typical Up or Down market reactions to specific major US economic reports 
go to:  Economic Indicator Effects

TRADER'S TIP: "Nay-Sayers and Hay-Makers"

It seems that practically every market turn comes draped in commentary and analysis from all angles of pundits and prophets. For every pullback there's the requisite reasoning for a "golden buying opportunity," which comes equally weighted with the seemingly sound logic of numerous warning signs signaling impending doom. Enough already! Once in a while try turning down the volume and simply observing the charts and figures that come across without the rhetoric. It can be so much more informative.

Stocks Covered in This Issue

BASIC MATERIALS SECTOR

Agnico Eagle Mines Limited (AEM: Basic Materials/Gold) - BULLISH BOUNCE. If you are looking for another bouncer with profits in mind, AEM fits the bill. Shares have been in retreat-mode lately, but now this stock is in the process of bouncing from support. Currently priced at 56.32, plan to buy shares at 57.29 and use a 3.51 trailing stop. Tighten the stop to 1.76 on a 2.94 gain. Earnings Report Date: Apr 27, 2023. Beta: 0.80. Market-Cap: 25.795B. Optionable.

COMMUNICATION SERVICES SECTOR

Manchester United plc (MANU: Communication Services/Entertainment) - SQUEEZE PLAY. The struggle between buyers and sellers has resulted in MANU's narrowest trading range of the past seven sessions. With neither group able to take complete control on Tuesday, the stock's short term destiny is up for grabs. You can capitalize on this unusually tight condition by placing both a BUY order at 21.86 and a SELL order at 20.33. Regardless of which order is triggered, cancel the other one and follow your entry with a 1.53 trailing stop. Tighten the stop to 0.77 once you have a 2.36 gain. MANU closed Tuesday at 21.00. Earnings Report Date: May 24, 2023. Beta: 0.68. Market-Cap: 3.509B. Optionable.

HEALTHCARE SECTOR

Merus N.V. (MRUS: Healthcare/Biotechnology) - SQUEEZE PLAY. One interesting trait of price volatility is that it cycles back and forth through periods of expansion and contraction. Stocks that have recently seen their daily price range shift from an average or wide range to an extremely contracted state are ideal candidates for expansive price moves. In many cases the next move is relatively fast and covers a sizable amount of territory. To take advantage of these trades we use both a BUY and a SELL entry. This allows us to enter in whichever direction the breakout takes. In MRUS's case we will enter a BUY should it reach the 21.45 level, or a SELL short trade if it drops to 19.46. As usual a trailing stop is essential, 1.99 which should be tightened to 1 on a 2.32 gain. MRUS closed Tuesday at 20.19. Earnings Report Date: May 08, 2023. Beta: 0.75. Market-Cap: 935.146M. Optionable.

Zentalis Pharmaceuticals, Inc. (ZNTL: Healthcare/Biotechnology) - SQUEEZE PLAY. In certain stocks a tightly constricted price range is a sign that neither bulls nor bears are confident of winning in the near term. This often means that the side that gives up first causes a quick move in the opposite direction. In these fear dominated skirmishes, opposing traders always benefit from the retreat. In the Squeeze Play setup you can actually play both sides of the inevitable surge. ZNTL traders reached this state of stand-off on Tuesday with the tightest range of the past seven days. You can take advantage of their efforts by placing a low risk BUY trigger at 22.3 and a SELL short trigger at 20.84. After one of the two orders is filled, cancel the un-triggered order and place a trailing stop at 1.46 which can be tightened to 0.73 on a 2.14 gain. ZNTL closed Tuesday at 21.79. Earnings Report Date: May 03, 2023. Beta: 1.83. Market-Cap: 1.295B. 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.

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.

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