Notes From The Editor

Guess what? Trading doesn't have to be complicated. Although this simple message rarely makes the financial news, learning to make money in stocks isn't all that difficult.

Thankfully you don't have to be a rocket scientist to be a successful trader. In fact, folks of average intelligence tend to do better trading stocks than the genius types.

All good trading strategies share the same foundation - Risk Control. You probably already know this. Now ask yourself this question ... Do you always use a risk calculator to determine your position size before you enter a trade?

And how about trade execution? Have you ever ordered the wrong number of shares? Or bought the wrong stock? Have you ever gone short when you meant to go long?

Believe me, you're not alone. After working with hundreds of traders I've come to the conclusion that brains and self-control are not the same thing.

In the real world, a high percentage of "smart" people are extremely undisciplined. Many have a hard time following a simple routine, and will do anything to avoid tasks they consider to be monotonous or tedious.

That's too bad, for trading stocks requires a disciplined touch. Just like sports, the trading game is repetitive. Successful traders do the same things over and over. We're not talking about actions that are extremely hard to do, like a hundred pushups every thirty minutes. Trading is made up of relatively simple tasks, yet the ability to consistently implement each aspect of an effective method makes all the difference in the world.

For example, trade execution is a lot like filling out a personal information form online. Have you ever had to retype simple data - like a credit card or social security card number more than twice to get it right? Reaching the point where you can get it right the first time takes the kind of disciplined practice that makes for a good trader.

This type of self-discipline isn't hard and it certainly isn't complicated. However, I'm not sure if anyone can really teach another person how to do it. Granted, it does help if someone reminds us to "pay attention" from time to time. I suppose that's what I'm doing right now - though I have to admit that it's as good for me to hear it as it is for you.

Trade well,

Thomas Sutton, Editor

Quick List

    
Stock     02/15     02/15      Buy      Short   Trailing Stops     Gain 
Symbol    Price      +/-      Entry     Entry   Initial/Tighten   Amount 
------  --------  --------  --------  --------  ---------------  --------

BYON      26.12      0.66     26.58     24.79         1.79/0.9      2.36
COST     724.51      2.33    735.56                39.08/19.54     19.04
AIZ      172.49      0.70    175.92                  9.48/4.74       4.9
IMNM      22.52      0.78     23.28     20.61        2.67/1.34      2.94
FDMT      27.69     -0.12        29     26.84        2.16/1.08      2.08

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.

Market Summary

After trading relatively flat Thursday morning, equity markets gained momentum throughout the session, ultimately closing with solid gains. This follows a week of fluctuating movements, with Tuesday's selloff driven by inflation concerns mostly offset by gains on Wednesday and Thursday. The focus remains on the state of consumer sentiment and corporate earnings announcements, with retail sales figures playing a significant role in the day's positive trajectory. The data suggested that the economy might not exert as much upward pressure on inflation as initially feared after Tuesday's consumer price index (CPI) report. Interest rates edged lower, though the 10-year Treasury yield remained above 4.2%. Across sectors, real estate, materials, and energy stocks led the gains, supported by higher gold and oil prices, while the technology sector lagged behind.

The January retail sales report revealed a slowdown in household spending at the beginning of the year. Spending declined by 0.8% compared to the previous month, although this was partly due to a significant drop in gasoline station sales, which does not necessarily signal concerning consumer behavior. Weakness in automobile sales also suggests that consumers may not be fully exhausted in terms of spending, but may be shifting away from big-ticket purchases as labor market and economic momentum ease.

However, with concerns earlier in the week about persistent inflation potentially prolonging the Fed's restrictive stance, evidence of softer household spending supports the notion that overall inflation trends are likely to continue trending downwards. This sentiment is reflected in the bond market's reaction Thursday and aligns with our expectations for Fed rate cuts to commence this summer.

                        Feb 14, 2024           Feb 15, 2024   
                  --------------------   --------------------
Dow                 38,424.27   151.52     38,773.12   348.85
Nasdaq              15,859.15   203.55     15,906.17    47.03
S&P 500              5,000.62    47.45      5,029.73    29.11

NYSE Volume                      3.86B                  4.14B
NYSE Advancers                   2,298                  2,359
NYSE Decliners                     542                    497

Nasdaq Volume                    5.12B                  6.06B
Nasdaq Advancers                 3,326                  3,022
Nasdaq Decliners                   951                  1,238

                                 New Highs/Lows

                   02/08  02/09  02/12  02/13  02/14  02/15
                 --------------------------------------------
NYSE New Highs       152    188    263     39    104    217
NYSE New Lows         26     20     12     48     35     14
Nasdaq New Highs     237    300    346     43    109    251
Nasdaq New Lows      104     84     55    122     77     66
   

TRADER'S TIP: "I Want It ALL NOW!"

Some people unknowingly take extreme risks by attempting to get rich too fast. Successful traders avoid greed and the damaging losses that accompany it. Use a trading method that is effective and protects your capital.

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".

Market Calendar

ECONOMIC REPORTS AND EVENTS (all times are Eastern):    

WEDNESDAY, FEB. 14					
None scheduled
				
THURSDAY, FEB. 15					
8:30 am	Initial jobless claims	
8:30 am	Empire State manufacturing survey	
8:30 am	Philadelphia Fed manufacturing survey	
8:30 am	Import price index	
8:30 am	Import price index minus fuel	
8:30 am	U.S. retail sales	
8:30 am	Retail sales minus autos	
9:15 am	Industrial production	
9:15 am	Capacity utilization	
10:00 am	Home builder confidence index	

FRIDAY, FEB. 16					
8:30 am	Housing starts	
8:30 am	Building permits	
8:30 am	Producer price index	
8:30 am	Core PPI	
8:30 am	PPI year over year		
8:30 am	Core PPI year over year			
10:00 am	Consumer sentiment (prelim)

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

TRADER'S TIP: "Focus: Money or Education?"

There is a tremendous difference between focusing on money and focusing on using your trading as an exercise to identify what you need to learn. The first will cause you to focus on what the markets are giving you or are taking away from you. The second perspective causes you to focus your attention on your ability to give yourself money. With the first perspective, you are placing some of the responsibility onto the markets to do something for you. With the second perspective, you assume all the responsibility.

Stocks Covered in This Issue

CONSUMER CYCLICAL SECTOR

Beyond, Inc. (BYON: Consumer Cyclical/Internet Retail) - SQUEEZE PLAY. BYON 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 26.58 and a SELL short entry at 24.79. Once your trade is filled, enter a 1.79 trailing stop. Tighten it to 0.9 after a 2.36 gain. BYON closed on Thursday at 26.12. Earnings Report Date: Feb 20, 2024. Beta: 3.69. Market-Cap: 1.183B. Optionable.

CONSUMER DEFENSIVE SECTOR

Costco Wholesale Corporation (COST: Consumer Defensive/Discount Stores) - BULLISH BOUNCE. Positive price behavior near moving average support on Thursday qualifies COST for a Bullish Bounce setup. After several sessions of declining prices, COST should soon begin trading in step with its established weekly uptrend. Tell your broker to BUY shares if COST moves up to our entry trigger set at 735.56. You can also enter a 39.08 trailing stop, to be replaced with a 19.54 trailing stop when you obtain a 19.04 profit. COST closed Thursday at 724.51. Earnings Report Date: Mar 07, 2024. Beta: 0.76. Market-Cap: 321.485B. Optionable.

FINANCIAL SERVICES SECTOR

Assurant, Inc. (AIZ: Financial Services/Insurance - Specialty) - BULLISH BOUNCE. Another bullish bouncer, AIZ appears ready to resume trading in an uptrend after recent selling forced the stock lower for several days. Thursday's positive price action near Moving Average support says it's time to BUY shares if AIZ reaches our entry trigger set at 175.92. Also place a 9.48 trailing stop which can be narrowed to 4.74 when you reach a 4.9 profit. AIZ closed Thursday at 172.49. Earnings Report Date: Apr 30, 2024. Beta: 0.49. Market-Cap: 9.071B. Optionable.

HEALTHCARE SECTOR

Immunome, Inc. (IMNM: Healthcare/Biotechnology) - SQUEEZE PLAY. Thursday'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 23.28 and your SELL short trigger at 20.61. One of the orders will be triggered by upcoming price action. When your market order is filled, cancel the remaining trigger and enter a 2.67 trailing stop. Once you have a 2.94 profit, reduce the stop to 1.34. Earnings Report Date: Mar 14, 2024. Beta: 1.56. Market-Cap: 1.028B. Optionable.

4D Molecular Therapeutics, Inc. (FDMT: Healthcare/Biotechnology) - SQUEEZE PLAY. Traders are feeling the pressure as FDMT's intra-day price range on Thursday shrunk to the narrowest spread in over a week. The tension between buyers and sellers should provide enough pent-up engergy for a breakout move in the days ahead, so get ready to trade with the new trend. To achieve that, place a BUY entry at 29 and a SELL short entry at 26.84. FDMT's price movement will decide which entry is filled. As soon as you're in the trade, enter a 2.16 trailing stop. Tighten it to 1.08 after you get a 2.08 gain. FDMT closed Thursday at 27.69. Earnings Report Date: Mar 13, 2024. Beta: 2.62. Market-Cap: 1.366B. 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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