|
February 15, 2022 - The RightLine Report
**********************************
NOTES FROM THE EDITOR
**********************************
In a previous RightLine Report we looked at some of veteran trader Brett Steenbarger's thoughts on "Perfectionism." Brett is a licensed psychologist who has traded actively for the past 20 years, and writes extensively about the mental aspects of trading the markets.
***********************************
"QUICK LIST"
***********************************
Stock 02/15 02/15 Buy Short Trailing Stops Gain
Symbol Price +/- Entry Entry Initial/Tighten Amount
------ -------- -------- -------- -------- --------------- --------
BHP 67.52 -0.74 68.45 4.38/2.19 2.66
CHGG 30.77 0.32 31.81 29.66 2.15/1.08 3.02
MS 103.43 0.86 105.72 6.7/3.35 6.52
AGL 21.87 1.07 22.16 20.32 1.84/0.92 2.84
BASE 24.11 1.35 24.54 2.24/1.12 4.02
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
*****************************
US stocks rallied on Tuesday despite concerns over hawkish Fed Bank monetary policy and rising inflation following news that January wholesale prices were up more than expected. In other economic headlines, manufacturing activity in the New York region bounced back into expansion territory after last month's decline into the contraction zone. On the equities front, Marriott International (MAR $181) solidly topped earnings estimates but noted that travel still remains below pre-pandemic levels, while Intel (INTC $48) announced they are purchasing Israeli chipmaker Tower Semiconductors in a $5.4-billion dollar deal. Gold, oil prices and the USD/dollar closed lower, treasuries were mixed. Feb 14, 2022 Feb 15, 2022
-------------------- --------------------
Dow 34,566.17 -171.89 34,988.84 422.67
Nasdaq 13,790.92 -0.24 14,139.76 348.84
S&P 500 4,401.67 -16.97 4,471.07 69.40
NYSE Volume 4.69B 4.5B
NYSE Advancers 939 2,579
NYSE Decliners 2,423 786
Nasdaq Volume 4.42B 4.45B
Nasdaq Advancers 1,476 3,787
Nasdaq Decliners 3,240 970
New Highs/Lows
02/08 02/09 02/10 02/11 02/14 02/15
--------------------------------------------
NYSE New Highs 58 91 86 67 24 34
NYSE New Lows 242 148 349 375 486 181
Nasdaq New Highs 71 64 61 54 38 52
Nasdaq New Lows 249 148 268 360 401 193
***********************************
TRADER'S TIP:
***********************************
TRADER'S TIP: "Sunny Days" Researchers at Ohio State and the University of Michigan found a positive correlation between the weather and the stock markets around the globe between 1982 and 1997. Specifically, the stock markets in 26 countries went up more than average when it was sunny in the cities where the markets were located, and declined more than average when it was cloudy. **************************
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 - 4471.07 February 15, 2022 52-Week High: 4818.62 52-Week Low: 3723.34 Daily Trend: DOWN Weekly trend: DOWN Weekly Pivot Levels Resistance 3: 4847.26 Resistance 2: 4658.64 Resistance 1: 4538.64 Pivot: 4470.02 Support 1: 4350.02 Support 2: 4281.40 Support 3: 4092.78 https://www.prorightline.com/rlch/021522SPX.jpg--ECONOMIC REPORTS AND EVENTS (all times are Eastern): Monday, February 14, 2022: 14-Feb None scheduled Tuesday, February 15, 2022: 15-Feb 8:30 am Producer price index 15-Feb 8:30 am Empire state manufacturing index Wednesday, February 16, 2022: 16-Feb 8:30 am Retail sales 16-Feb 8:30 am Retail sales excluding autos 16-Feb 8:30 am Import price index 16-Feb 9:15 am Industrial production 16-Feb 9:15 am Capacity utilization 16-Feb 10 am Business inventories 16-Feb 10 am NAHB home builders' index 16-Feb 2:30 pm FOMC minutes Thursday, February 17, 2022: 17-Feb 8:30 am Initial jobless claims 17-Feb 8:30 am Continuing jobless claims 17-Feb 8:30 am Building permits (SAAR) 17-Feb 8:30 am Housing starts (SAAR) 17-Feb 8:30 am Philadelphia Fed manufacturing index Friday, February 18, 2022: 18-Feb 10 am Existing home sales (SAAR) 18-Feb 10 am Leading economic indicators 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: "Use More Than One Indicator" Instead of relying on just one indicator to make trade decisions, use several as part of your overall strategy. Watch for a convergence of signals because it increases the odds of the expected outcome. ***********************************
STOCKS COVERED IN THIS ISSUE
***********************************
BASIC MATERIALS SECTOR BHP Group Limited (BHP: Basic Materials/Other Industrial Metals & Mining) - BULLISH BOUNCE. Looking a bit frayed after sliding downhill in recent sessions, on Tuesday BHP seemed intent on initiating a rebound. With moving average support nearby, BHP is at a logical place for Bulls to regroup and extend the familiar uptrend that shareholders have become accustomed to. On continued buying, plan on taking long entries with a BUY at 68.45. Manage risk with a 4.38 stop. Tighten your stop to 2.19 when you have a 2.66 profit. BHP ended the day at 67.52. Earnings Report Date: N/A. Beta: 0.77. Market-Cap: 245.027B. Optionable. CONSUMER DEFENSIVE SECTOR Chegg, Inc. (CHGG: Consumer Defensive/Education & Training Services) - SQUEEZE PLAY. A look at CHGG's daily chart shows what a price squeeze is all about. The constricted high-low daily trading range has produced a setup similar to a tightly coiled spring. Expect price to move sharply soon, with the direction yet to be determined. Let the upcoming market action resolve whether you will buy shares or sell short. To capture a move either way, place a BUY trigger at 31.81 and a SELL short trigger at 29.66. Once CHGG shows which way it's headed, place your triggered entry order. As soon as your order is filled, follow with a trailing stop of 2.15 and tighten to 1.08 on a 3.02 gain. CHGG closed Tuesday at 30.77. Earnings Report Date: May 02, 2022. Beta: 0.96. Market-Cap: 4.134B. Optionable. FINANCIAL SERVICES SECTOR Morgan Stanley (MS: Financial Services/Capital Markets) - BULLISH BOUNCE. The charts for MS 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 105.72, and follow your entry with a trailing stop of 6.7. Tighten it to 3.35 when a 6.52 profit is reached. MS ended the latest session at 103.43. Earnings Report Date: Apr 14, 2022. Beta: 1.45. Market-Cap: 183.278B. Optionable. HEALTHCARE SECTOR agilon health, inc. (AGL: Healthcare/Medical Care Facilities) - SQUEEZE PLAY. Tuesday's narrow price range has created a potentially profitable setup in AGL, as sellers and buyers find themselves in a near tie for control of price direction. The next short-term trend could go either way, so prepare for a move out of the draw within the next day or so. Set a BUY entry at 22.16 and a SELL short entry at 20.32. Let AGL's price action determine your long or short entry. Once the order is filled, place a 1.84 trailing stop, and tighten it to 0.92 upon getting a 2.84 gain. AGL closed Tuesday at 21.87. Earnings Report Date: Mar 03, 2022. Beta: N/A. Market-Cap: 8.609B. Optionable. TECHNOLOGY SECTOR Couchbase, Inc. (BASE: Technology/Software-Infrastructure) - BULLISH BOUNCE. BASE'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 BASE back in step with the bullish weekly trend, so our BUY entry trigger is set at 24.54. Once you hold a position, trail a stop of 2.24. Tighten it to 1.12 on a 4.02 gain. BASE closed at 24.11 on Tuesday. Earnings Report Date: N/A. Beta: N/A. Market-Cap: 1.051B. 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 ---------------- ------- -------- ------- ------ ------- ePlus PLUS 11/9/2021 12/14/2021 2-for-1 Yes NAPCO Security NSSC 12/8/2021 1/5/2022 2-for-1 Yes AeroCentury Corp ACY 12/17/2021 1/10/2022 5-for-1 No Merchants Bancorp MBIN 11/17/2021 1/18/2022 2-for-1 No SMART Global Hold SGH 1/4/2022 2/2/2022 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. 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 To Unsubscribe, send an email to cs@prorightline.com or call 800-737-4518. |