December 20, 2022 - The RightLine Report ********************************** NOTES FROM THE EDITOR **********************************
Feeling, Thinking and Trading
*********************************** "QUICK LIST" *********************************** Stock 12/20 12/20 Buy Short Trailing Stops Gain Symbol Price +/- Entry Entry Initial/Tighten Amount ------ -------- -------- -------- -------- --------------- -------- PINS 24.44 0.27 25.02 2.01/1.01 2.06 PERI 25.14 0.11 25.56 1.67/0.84 1.7 IGT 22.61 -0.06 23.12 21.69 1.43/0.72 1.38 ARRY 20.73 0.27 21.52 2.66/1.33 3.02 SHLS 25.20 0.48 26.22 2.92/1.46 4.3 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/ ***************************** MARKET SUMMARY ***************************** The major US stock market indices were higher on Tuesday as traders considered a round of monetary policy decisions from Asian central banks. The People's Bank of China and Bank of Japan left their benchmark interest rates unchanged, as the BOJ surprisingly tweaked its yield curve control policy by widening its cap on the 10-year Japanese Government Bond yields. In economic news, housing starts were down by less than predicted, and building permits dropped much more than analysts expected. Equity headlines featured General Mills (GIS $83) beating earnings estimates and raising its full-year guidance, while shares of Steel Dynamics (STLD $103) were higher after Standard & Poor announced that STLD will replace ABIOMED (ABMD $381) in the S&P 500. Gold prices, crude oil and treasury yields all rallied, the USD/dollar finished the session lower. Dec 19, 2022 Dec 20, 2022 -------------------- -------------------- Dow 32,757.54 -162.92 32,849.74 92.20 Nasdaq 10,546.03 -159.38 10,547.11 1.08 S&P 500 3,817.66 -34.70 3,821.62 3.96 NYSE Volume 4.03B 4.01B NYSE Advancers 932 1,650 NYSE Decliners 2,222 1,500 Nasdaq Volume 4.68B 4.74B Nasdaq Advancers 1,269 2,359 Nasdaq Decliners 3,357 2,238 New Highs/Lows 12/13 12/14 12/15 12/16 12/19 12/20 -------------------------------------------- NYSE New Highs 91 46 38 31 41 48 NYSE New Lows 56 92 126 178 166 164 Nasdaq New Highs 123 100 84 67 79 86 Nasdaq New Lows 249 247 377 462 536 467 *********************************** TRADER'S TIP: *********************************** TRADER'S TIP: "More on Trading Frequency" "If we flip a coin only ten times our odds of having 50% heads and 50% tails are not very good. However if we flip the coin one thousand times we are likely to come much closer to obtaining 50% heads and 50% tails. The same logic applies to our real-time trading. If we have a large sample of real trades then our results should come closer to our expectations than if we only have one or two trades. The active system will approach our expectations much quicker than the system that trades infrequently. If we have 50 or more trades per month with a good system we might reasonably expect to be profitable every month. However if we have a system that is only producing two or three trades per month then our monthly results will less predictable and inconsistent. The infrequent trading system might be expected to produce a profit every year but it would not be realistic to expect it to show a profit every month because the sample size in a month will be very small." ~Chuck LeBeau, Trader and author ************************** THE TECHNICAL ANALYST ************************** 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 - 3821.62 December 20, 2022 52-Week High: 4818.62 52-Week Low: 3491.58 Daily Trend: DOWN Weekly trend: UP Weekly Pivot Levels Resistance 3: 4473.17 Resistance 2: 4200.12 Resistance 1: 4026.24 Pivot: 3927.07 Support 1: 3753.19 Support 2: 3654.02 Support 3: 3380.97 https://www.prorightline.com/rlch/122022SPX.jpg--ECONOMIC REPORTS AND EVENTS (all times are Eastern): Monday, December 19, 2022: 19-Dec 10 am NAHB home builders' index Tuesday, December 20, 2022: 20-Dec 8:30 am Building permits (SAAR) 20-Dec 8:30 am Housing starts (SAAR) Wednesday, December 21, 2022: 21-Dec 8:30 am Current account deficit 21-Dec 10 am Consumer confidence index 21-Dec 10 am Existing home sales (SAAR) Thursday, December 22, 2022: 22-Dec 8:30 am Initial jobless claims 22-Dec 8:30 am Continuing jobless claims 22-Dec 8:30 am Real gross domestic product revision (SAAR) 22-Dec 8:30 am Real gross domestic income revision (SAAR) 22-Dec 8:30 am Real final sales to domestic purchasers (SAAR) 22-Dec 8:30 am Chicago Fed national activity index 22-Dec 10 am Index of leading economic indicators Friday, December 23, 2022: 23-Dec 8:30 am PCE price index 23-Dec 8:30 am Core PCE price index 23-Dec 8:30 am PCE price index (year-on-year) 23-Dec 8:30 am Core PCE price index (year-on-year) 23-Dec 8:30 am Real disposable income (SAAR) 23-Dec 8:30 am Real consumer spending (SAAR) 23-Dec 8:30 am Durable goods orders 23-Dec 8:30 am Core capital equipment orders 23-Dec 10 am UMich consumer sentiment index (late) 23-Dec 10 am UMich 5-year inflation expectations (late) 23-Dec 10 am New home sales (SAAR) 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/ *********************************** TRADER'S TIP: *********************************** TRADER'S TIP: "Weekly Volume" Trading volume either confirms price movement or brings it into question. It's considered very bullish when a stock rises on higher than average volume, while a similar move on lower than average volume is less bullish. It's always a good idea to look at a weekly chart to confirm rising volume. You can have five sessions of moderately higher volume on a daily chart without seeing anything significant. But put it on a weekly chart and suddenly it stands out in stark contrast. When all of those slightly higher volume days are added together, they show a real spike. Rising volume often means that institutions are buying, and that's the kind of buying that drives stocks skyward. *********************************** STOCKS COVERED IN THIS ISSUE *********************************** COMMUNICATION SERVICES SECTOR Pinterest, Inc. (PINS: Communication Services/Internet Content & Information) - BULLISH BOUNCE. If you are looking for another bouncer with profits in mind, PINS 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 24.44, plan to buy shares at 25.02 and use a 2.01 trailing stop. Tighten the stop to 1.01 on a 2.06 gain. Earnings Report Date: Feb 01, 2023. Beta: 0.98. Market-Cap: 16.576B. Optionable. Perion Network Ltd. (PERI: Communication Services/Internet Content & Information) - BULLISH BOUNCE. This trader-friendly setup turns repetitive stock behavior into real profits. Based on the tendency for up-trending stocks to drop briefly and then resume the up-trend, the Bullish Bounce places traders into excellent stocks when conditions are primed for more skyward movement. PERI's current price action near moving average support signals a potential BUY entry at 25.56, followed by a 1.67 trailing stop which can be tightened to 0.84 upon earning 1.7. PERI closed Tuesday at 25.14. Earnings Report Date: Feb 07, 2023. Beta: 1.24. Market-Cap: 1.129B. Optionable. CONSUMER CYCLICAL SECTOR International Game Technology PLC (IGT: Consumer Cyclical/Gambling) - SQUEEZE PLAY. IGT 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 23.12 and a SELL short entry at 21.69. Once your trade is filled, enter a 1.43 trailing stop. Tighten it to 0.72 after a 1.38 gain. IGT closed on Tuesday at 22.61. Earnings Report Date: Mar 06, 2023. Beta: 1.88. Market-Cap: 4.529B. Optionable. TECHNOLOGY SECTOR Array Technologies, Inc. (ARRY: Technology/Solar) - BULLISH BOUNCE. Up-trending stocks like ARRY have a tendency to bounce their way skyward rather than travel higher in a straight line. After touching down to a moving average support level on Tuesday, ARRY is poised to lift off again. To take advantage of this setup, prepare to BUY shares at 21.52 if positive price action occurs. As always, follow your entry with a trailing stop. A 2.66 trailer should work well with ARRY. Tighten it to 1.33 on a 3.02 gainer. Earnings Report Date: N/A. Beta: 1.98. Market-Cap: 3.12B. Optionable. Shoals Technologies Group, Inc. (SHLS: Technology/Solar) - BULLISH BOUNCE. SHLS has charted an upward weekly trend until recently when sellers showed up to push prices lower. On Tuesday the selling ran into solid support. A potential bounce up from this level should attract buyers and likely return SHLS to the previously established uptrend. The Bullish Bounce set-up is the basis for our BUY entry, so be ready to go long on a rise to our trigger at 26.22. Set a trailing stop of 2.92, tightening to 1.46 on a 4.3 profit. SHLS closed at 25.20 on Tuesday. Earnings Report Date: Mar 08, 2023. Beta: N/A. Market-Cap: 2.911B. 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 *********************************** 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 ---------------- ------- -------- ------- ------ ------- Copart CPRT 11/4/2022 11/4/2022 2-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! ********** If you prefer to receive this report in html with color and graphics, or have any questions, send us an email using our contact form at:https://prorightline.com/index.php/contact-us/ ====================================================================== 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. 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