Notes From The Editor

The market is a lot like the weather ... it does whatever it wants to, regardless of our plans and wishes. Here are a few things to consider when the market weather doesn't quite meet your preferences:

~ The market is much bigger than any of us. There is nothing we can do to control or change it. However, we can control our behavior and make wise trading choices.

~ Like the weather, the market isn't aware of our desires and it doesn't care about what we want. Don't take it personal - that's just the way it is.

~ The market doesn't "make" us feel any particular way. Our feelings about the market only exist in our minds. These feelings are the result of our individual beliefs.

~ We can decide what to believe. As we shape our beliefs to reflect the "real" market, our feelings about the market change too. If the market "makes" you feel bad, remember that you can always change your mood.

~ The market offers us opportunity for both profit and pain. Through our trading experiences we learn to recognize what causes each of these, and then we choose between the two by taking specific actions that lead to profit. Learning these behaviors -- trading skills -- takes time, so be patient with yourself and the process.

~ Reacting emotionally to price movement disrupts our ability to make intelligent decisions.

~ The market can't hurt us unless we let it. Risk Control provides a simple way to stay dry and warm in stormy weather - even when others are shivering in the rain.

Trade well!

~ Thomas Sutton, Editor

Quick List

    
Stock     07/12     07/12      Buy      Short   Trailing Stops     Gain 
Symbol    Price      +/-      Entry     Entry   Initial/Tighten   Amount 
------  --------  --------  --------  --------  ---------------  --------

SIX       20.79      0.41     21.59     19.64        1.95/0.98      2.96
CVNA      22.07     -0.02      23.2     20.89        2.31/1.16      5.76
RCUS      27.96      0.58     28.41                  2.86/1.43       3.2
ZTO       26.30      0.42     26.91                  1.82/0.91      0.58
EE        20.10     -0.30      20.8     19.01         1.79/0.9       3.7

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

The top three US stock indices were all lower on Tuesday, as traders showed caution ahead of Wednesday's upcoming key report on consumer prices. On the economic front, small business optimism dropped to its lowest level in 9-years, and the percentage of small businesses who expect conditions to improve during the next six months fell to the lowest level in the history of the survey. In equities, earnings season kicked off with shares of PepsiCo (PEP $170) moving higher after the beverage company topped forecasts and raised its guidance, while Peloton (PTON $9) announced that it will outsource all of its manufacturing. The USD/dollar inched upward, treasuries were higher, pushing yields lower. Gold and oil prices closed out the session lower.

                        Jul 11, 2022           Jul 12, 2022   
                  --------------------   --------------------
Dow                 31,173.84  -164.31     30,981.33  -192.51
Nasdaq              11,372.60  -262.71     11,264.73  -107.87
S&P 500              3,854.43   -44.95      3,818.80   -35.63

NYSE Volume                      3.48B                  3.85B
NYSE Advancers                     980                  1,429
NYSE Decliners                   2,232                  1,773

Nasdaq Volume                    4.35B                  4.31B
Nasdaq Advancers                 1,198                  2,043
Nasdaq Decliners                 3,380                  2,454

                                 New Highs/Lows

                   07/05  07/06  07/07  07/08  07/11  07/12
                 --------------------------------------------
NYSE New Highs         4     12     11      7      5     10
NYSE New Lows        313    182     59     56    132    158
Nasdaq New Highs      20     25     24     27     23     23
Nasdaq New Lows      477    209    118     83    182    211
   

TRADER'S TIP: "Price Action Near Support & Resistance Lines"

It pays to watch support and resistance lines for potential trade setups. One of the best low-risk buy signals takes place when price dips below a significant support line, and then comes back up and closes above it. In the same fashion, a good shorting opportunity is usually provided when price rises marginally above a resistance line, then reverses to close below it.

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 - 3818.80 July 12, 2022

52-Week High: 4818.62
52-Week Low: 3636.85
Daily Trend: UP
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 4206.19
Resistance 2: 4029.75
Resistance 1: 3964.56
Pivot: 3853.31
Support 1: 3788.12
Support 2: 3676.87
Support 3: 3500.43

NASDAQ Composite - 11264.73 July 12, 2022

52-Week High: 16212.23
52-Week Low: 10565.14
Daily Trend: UP
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 12968.65
Resistance 2: 12190.40
Resistance 1: 11912.85
Pivot: 11412.15
Support 1: 11134.60
Support 2: 10633.90
Support 3: 9855.65
        
Dow Industrials - 30981.33 July 12, 2022

52-Week High: 36952.65
52-Week Low: 29653.27
Daily Trend: UP
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 33380.92
Resistance 2: 32224.58
Resistance 1: 31781.36
Pivot: 31068.24
Support 1: 30625.02
Support 2: 29911.90
Support 3: 28755.56
 

Market Calendar

ECONOMIC REPORTS AND EVENTS (all times are Eastern):    

Monday, July 11, 2022:
11-Jul  11 am   3-year inflation expectations

Tuesday, July 12, 2022:
12-Jul   6 am   NFIB small-business index

Wednesday, July 13, 2022:
13-Jul  8:30 am   Consumer price index (monthly)
13-Jul  8:30 am   Core CPI (monthly)
13-Jul  8:30 am   CPI (year-over-year)
13-Jul  8:30 am   Core CPI (year-over-year)
13-Jul   2 pm   Beige book
13-Jul   2 pm   Federal budget (comparison vs. year-ago)

Thursday, July 14, 2022:
14-Jul  8:30 am   Producer price index final demand (monthly)
14-Jul  8:30 am   Initial jobless claims
14-Jul  8:30 am   Continuing jobless claims

Friday, July 15, 2022:
15-Jul  8:30 am   Retail sales
15-Jul  8:30 am   Retail sales excluding vehicles
15-Jul  8:30 am   Import price index
15-Jul  8:30 am   Empire state manufacturing index
15-Jul  9:15 am   Industrial production index
15-Jul  9:15 am   Capacity utilization
15-Jul  10 am   UMich consumer sentiment index (preliminary)
15-Jul  10 am   UMich 5-year inflation expectations (preliminary)
15-Jul  10 am   Business inventories


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

TRADER'S TIP: "The Buy and Hold Myth"

Most long-term investors like to believe they are unaffected by short- term price fluctuations in the market. However, since most buy-and- hold advocates have no Exit Plan or Risk Control Strategy to protect capital and profits, the emotions of fear and pain eventually come to bear, often forcing unprepared investors to sell under the worst conditions.

Stocks Covered in This Issue

CONSUMER CYCLICAL SECTOR

Six Flags Entertainment Corporation (SIX: Consumer Cyclical/Leisure) - 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. SIX 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 21.59 and a SELL short trigger at 19.64. After one of the two orders is filled, cancel the un-triggered order and place a trailing stop at 1.95 which can be tightened to 0.98 on a 2.96 gain. SIX closed Tuesday at 20.79. Earnings Report Date: Aug 11, 2022. Beta: 2.28. Market-Cap: 1.797B. Optionable.

Carvana Co. (CVNA: Consumer Cyclical/Internet Retail) - SQUEEZE PLAY. CVNA traders on both sides of the fence are now locked in a head-to-head shootout. Tuesday's price range was the narrowest in over a week, as neither Bears or Bulls have been able to clearly gain the upper hand. This gives us an opportunity to catch the next directional move with little risk of loss. To do this we'll place both a long and a short trigger with a BUY at 23.2 and a SELL short trigger at 20.89. When one of the orders is filled, cancel the remaining order and enter a 2.31 trailing stop. When you've reached a 5.76 paper profit, tighten the stop to 1.16. CVNA closed at 22.07 on Tuesday. Earnings Report Date: Aug 03, 2022. Beta: 2.64. Market-Cap: 3.92B. Optionable.

HEALTHCARE SECTOR

Arcus Biosciences, Inc. (RCUS: Healthcare/Biotechnology) - BULLISH BOUNCE. Looking a bit frayed after sliding downhill in recent sessions, on Tuesday RCUS seemed intent on initiating a rebound. With moving average support nearby, RCUS 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 28.41. Manage risk with a 2.86 stop. Tighten your stop to 1.43 when you have a 3.2 profit. RCUS ended the day at 27.96. Earnings Report Date: Aug 03, 2022. Beta: 0.73. Market-Cap: 2.005B. Optionable.

INDUSTRIALS SECTOR

ZTO Express (ZTO: Industrials/Integrated Freight & Logistics) - BULLISH BOUNCE. The charts for ZTO 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 26.91, and follow your entry with a trailing stop of 1.82. Tighten it to 0.91 when a 0.58 profit is reached. ZTO ended the latest session at 26.30. Earnings Report Date: Aug 16, 2022. Beta: -0.01. Market-Cap: 21.296B. Optionable.

UTILITIES SECTOR

Excelerate Energy, Inc. (EE: Utilities/Utilities-Renewable) - SQUEEZE PLAY. The struggle between buyers and sellers has resulted in EE'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 20.8 and a SELL order at 19.01. Regardless of which order is triggered, cancel the other one and follow your entry with a 1.79 trailing stop. Tighten the stop to 0.9 once you have a 3.7 gain. EE closed Tuesday at 20.10. Earnings Report Date: N/A. Beta: N/A. Market-Cap: 2.176B. 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  
---------------- -------     --------    -------     ------  -------   
Gamestop          GME        7/7/2022   7/22/2022    4-for-1   Yes    

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.

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

Click Here To Unsubscribe