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August 4, 2022 - The RightLine Report
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NOTES FROM THE EDITOR
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What's the best trading strategy around? While there are basic guidelines for profitable trading - effective risk management, for example - there is no one-size-fits-all blueprint for success in the market. This is because each individual trader is unique.
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"QUICK LIST"
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Stock 08/04 08/04 Buy Short Trailing Stops Gain
Symbol Price +/- Entry Entry Initial/Tighten Amount
------ -------- -------- -------- -------- --------------- --------
CLAR 20.32 -0.32 21.01 19.22 1.79/0.9 2.18
BLNK 22.50 0.43 22.97 21.35 1.62/0.81 2.48
CVEO 27.33 -0.33 28.2 26.42 1.78/0.89 1.98
BMBL 35.81 0.22 36.74 33.92 2.82/1.41 4.12
SIX 23.98 0.11 24.44 22.78 1.66/0.83 2.48
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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Stocks closed mixed on Thursday, as the Dow Jones Industrial Average and the S&P 500 Index finished lower, while the Nasdaq Composite was higher. Earnings annuncements continued to pour in, with Kellogg (K $74) topping quarterly forecasts and delivering upbeat guidance, while Eli Lilly (LLY $306) fell short of expectations and lowered its outlook. The economic calendar reported jobless claims are moving higher ahead of Friday's labor report, while the US trade deficit shrunk by more than expected. The USD/dollar and oil prices were lower, gold and treasuries were higher, putting downward pressure on yields. Aug 3, 2022 Aug 4, 2022
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Dow 32,812.50 416.33 32,726.82 -85.68
Nasdaq 12,668.16 319.40 12,720.58 52.42
S&P 500 4,155.17 63.98 4,151.94 -3.23
NYSE Volume 4.42B 4.33B
NYSE Advancers 2,242 1,521
NYSE Decliners 973 1,673
Nasdaq Volume 5.68B 5.42B
Nasdaq Advancers 3,373 2,655
Nasdaq Decliners 1,302 1,906
New Highs/Lows
07/28 07/29 08/01 08/02 08/03 08/04
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NYSE New Highs 44 42 41 35 25 29
NYSE New Lows 50 46 48 32 36 37
Nasdaq New Highs 84 91 80 52 54 68
Nasdaq New Lows 131 121 118 95 57 51
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TRADER'S TIP:
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TRADER'S TIP: "Moving Averages and the Law of Attraction" All significant Daily Moving Averages - like the 50, 100 and 200 - act as magnets. Watch out when price begins to gain momentum toward a well known DMA. Once the action moves within a Moving Average's "gravitational field," just leave it up to the laws of physics - contact is almost inevitable. **************************
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 - 4151.94 August 4, 2022 52-Week High: 4818.62 52-Week Low: 3636.85 Daily Trend: UP Weekly trend: UP Weekly Pivot Levels Resistance 3: 4519.21 Resistance 2: 4289.80 Resistance 1: 4210.04 Pivot: 4060.39 Support 1: 3980.63 Support 2: 3830.98 Support 3: 3601.57 https://www.prorightline.com/rlch/080422SPX.jpg--ECONOMIC REPORTS AND EVENTS (all times are Eastern): Wednesday, August 03, 2022: 03-Aug 9:45 am 03-Aug 10 am ISM services index 03-Aug 10 am Factory orders 03-Aug 10 am Core capital equipment orders (revision) 03-Aug 10 am Rental vacancy rate 03-Aug 10 am Homeowner vacancy rate Thursday, August 04, 2022: 04-Aug 8:30 am Initial jobless claims 04-Aug 8:30 am Continuing jobless claims 04-Aug 8:30 am Trade deficit Friday, August 05, 2022: 05-Aug 8:30 am Nonfarm payrolls 05-Aug 8:30 am Unemployment rate 05-Aug 8:30 am Average hourly earnings 05-Aug 8:30 am Labor-force participation rate, ages 25-54 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 Market Weather" The market is much like the weather - we all know that it's pointless to try and change it. On the other hand, we can always adjust our sails to take advantage of the prevailing winds. ***********************************
STOCKS COVERED IN THIS ISSUE
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CONSUMER CYCLICAL SECTOR Clarus Corporation (CLAR: Consumer Cyclical/Leisure) - SQUEEZE PLAY. Sometimes when Bulls and Bears face off in the market arena for a typical day-long battle, there is no clear winner. This is evident when the daily price range contracts to an unusually narrow state. CLAR found itself in this condition on Thursday when neither buyers or sellers were able to push ahead. This setup provides traders a chance to hop on board the next breakout - whether it's to the upside or down - with little risk of loss. To do this place a BUY order at 21.01 and a SELL short trigger at 19.22. When CLAR moves outside of Thursday's range, one of the orders will be filled. Once you hold a position of shares, cancel the unfilled order and place a 1.79 trailing stop. After you've got a 2.18 profit, tighten the stop to 0.9. CLAR closed at 20.32 on Thursday. Earnings Report Date: N/A. Beta: 0.95. Market-Cap: 769.303M. Optionable. INDUSTRIALS SECTOR Blink Charging Co. (BLNK: Industrials/Engineering & Construction) - SQUEEZE PLAY. BLNK shareholders know what it feels like to be squeezed. Thursday's slim price range reveals uncertainty on both sides of the table, a situation which often resolves itself by either Bears or Bulls quickly gaining a clear advantage. The question is "who will win?" Near-term market action tell us whether we should sell short or we should buy shares instead. BLNK closed Thursday at 22.50. The plan is to enter in the right direction by placing a BUY trigger at 22.97 and a SELL short trigger at 21.35. Once BLNK establishes direction, place your triggered order. As soon as you are in the trade, place a trailing stop in the amount of 1.62. After you've collected a 2.48 profit, tighten the stop to 0.81. Earnings Report Date: Aug 08, 2022. Beta: 3.76. Market-Cap: 1.129B. Optionable. Civeo Corporation (CVEO: Industrials/Specialty Business Services) - SQUEEZE PLAY. Thursday's trading session left CVEO 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 28.2 and your SELL short trigger at 26.42. One of the orders will be triggered by upcoming price action. When your market order is filled, cancel the remaining trigger and enter a 1.78 trailing stop. Once you have a 1.98 profit, reduce the stop to 0.89. Earnings Report Date: Oct 26, 2022. Beta: 2.93. Market-Cap: 387.116M. Optionable. TECHNOLOGY SECTOR Bumble Inc. (BMBL: Technology/Software-Application) - SQUEEZE PLAY. BMBL 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 36.74 and a SELL short entry at 33.92. Once your trade is filled, enter a 2.82 trailing stop. Tighten it to 1.41 after a 4.12 gain. BMBL closed on Thursday at 35.81. Earnings Report Date: Aug 10, 2022. Beta: N/A. Market-Cap: 6.611B. Optionable. N/A SECTOR Six Flags Entertainment Corporation (SIX: N/A/N/A) - SQUEEZE PLAY. The ticker for Thursday's session shows SIX 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 24.44 and a SELL short trigger at 22.78. When SIX 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 1.66 trailing stop. Upon reaching a 2.48 profit, resize the stop to 0.83. Earnings Report Date: Aug 11, 2022. Beta: 2.21. Market-Cap: 2.073B. 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 ---------------- ------- -------- ------- ------ ------- Gamestop GME 7/7/2022 7/22/2022 4-for-1 Yes Alphabet GOOG 2/1/2022 7/18/2022 20-for-1 Yes Nasdaq Inc NDAQ 7/20/2022 8/29/2022 3-for-1 Yes For a closer look at the different stages of a Stock Split go to: https://prorightline.com/index.php/trading-stock-splits-stages/ ======================================================================
Best of luck and have a Great Week!
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