July 27, 2023 - The RightLine Report
Notes From The Editor
During times when the market is bouncing up around like a kangaroo, traders may feel a bit overwhelmed. The average daily range of the S&P 500 can quickly become much larger than usual, making it challenging to navigate the wild swings. To tackle this situation, a double-barrel strategy is recommended:
#1 - Control Risk: Managing risk is the most crucial aspect of trading. Utilizing tools like the RightLine Risk Control Calculator can be incredibly powerful in protecting against losses and increasing profits. While risk management alone may not transform a poor trading system into a winner, it plays a significant role in keeping losses in check while traders gain the necessary skills to navigate the markets successfully.
#2 - Trade Both Sides of the Market: Going short (betting on price declines) is just as accessible as going long (betting on price increases). During downtrends in major indices, short traders can find lower-risk opportunities compared to uptrends. Shorting allows traders to profit from investor fears surrounding credit markets, changes in Fed rates, economic concerns, and other market uncertainties frequently amplified by the media.
Volatility follows predictable patterns; it tends to expand until it reaches a highly agitated state, then contracts until the market becomes calmer. These cycles repeat across various timeframes, ranging from a few hours to weeks, months, or even longer.
Trade confidently,
Thomas Sutton, Editor
Stocks Covered Today Stock Splits
Quick List
Stock 07/27 07/27 Buy Short Trailing Stops Gain
Symbol Price +/- Entry Entry Initial/Tighten Amount
------ -------- -------- -------- -------- --------------- --------
GBCI 32.88 -0.72 34.38 31.75 2.63/1.32 1.86
SILK 22.39 -0.73 21.48 2.01/1.01 3.08
GNLX 23.36 0.11 21.97 3.49/1.75 5.78
BBIO 32.13 -0.28 33.17 30.63 2.54/1.27 1.9
ITRN 27.75 0.56 28.42 26.49 1.93/0.97 1.32
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.
Stocks Covered Today Stock Splits
Market Summary
US stocks experienced a significant downturn on Thursday, pulling back from recent 52-week highs. Initially the markets were on track for solid gains, boosted by positive economic data and upbeat earnings reports from major companies like META, CMCSA, and LRCX. However, the rally lost steam in the afternoon due to actions in Treasury and currency markets. The S&P 500 briefly crossed the 4,600 level but couldn't sustain it and turned negative midday. The Dow Jones Industrial Average ended its 13-day winning streak after Treasury yields surged on a weak auction and positive data.
The Bank of Japan's potential decision to allow long-term interest rates to rise added to market uncertainty. The rise in yields and currency fluctuations affected stock performance, with sectors like REITs and Utilities taking a hit.
Despite strong economic data, high growth technology sectors also saw profit-taking after initially leading the market higher. Transports and Smallcaps were among the biggest decliners.
On the commodities front, oil prices climbed over 1%, settling at $80.09 per barrel, supported by OPEC+ production cuts and optimism about Chinese demand and global growth. In contrast, gold prices stumbled, ending at $1,945.70 an ounce, due to a stronger dollar and rising Treasury yields impacting the precious metal.
Jul 26, 2023 Jul 27, 2023
-------------------- --------------------
Dow 35,520.12 82.05 35,282.72 -237.40
Nasdaq 14,127.28 -17.27 14,050.11 -77.17
S&P 500 4,566.75 -0.71 4,537.41 -29.34
NYSE Volume 3.99B 4.56B
NYSE Advancers 1,846 713
NYSE Decliners 1,056 2,251
Nasdaq Volume 4.33B 5.14B
Nasdaq Advancers 2,733 1,224
Nasdaq Decliners 1,650 3,170
New Highs/Lows
07/20 07/21 07/24 07/25 07/26 07/27
--------------------------------------------
NYSE New Highs 101 94 103 123 113 151
NYSE New Lows 10 7 10 15 6 17
Nasdaq New Highs 87 106 93 130 123 171
Nasdaq New Lows 75 68 97 106 104 109
Stocks Covered Today Stock Splits
TRADER'S TIP: "Husband and Wife"
It's okay to fall in love with a stock, but never marry it. Keeping an objective view of a trade is essential if you want to be able to exit without 'psychological' hang-ups. Do not become overly committed to a stock - the cost can be way too high.
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 - 4537.41 July 27, 2023
52-Week High: 4607.07
52-Week Low: 3491.58
Daily Trend: UP
Weekly trend: UP
Weekly Pivot Levels
Resistance 3: 4686.95
Resistance 2: 4613.42
Resistance 1: 4574.88
Pivot: 4539.89
Support 1: 4501.35
Support 2: 4466.35
Support 3: 4392.82
NASDAQ Composite - 14050.11 July 27, 2023
52-Week High: 14446.55
52-Week Low: 10088.83
Daily Trend: UP
Weekly trend: UP
Weekly Pivot Levels
Resistance 3: 15018.80
Resistance 2: 14592.70
Resistance 1: 14312.75
Pivot: 14166.60
Support 1: 13886.65
Support 2: 13740.50
Support 3: 13314.40
Dow Industrials - 35282.72 July 27, 2023
52-Week High: 35645.35
52-Week Low: 28660.94
Daily Trend: UP
Weekly trend: UP
Weekly Pivot Levels
Resistance 3: 36914.49
Resistance 2: 35960.44
Resistance 1: 35594.06
Pivot: 35006.39
Support 1: 34640.01
Support 2: 34052.34
Support 3: 33098.29
Stocks Covered Today Stock Splits
Market Calendar
ECONOMIC REPORTS AND EVENTS (all times are Eastern): Monday, July 24, 2023: 24-Jul 9:45 am S&P "flash" U.S. manufacturing PMI 24-Jul 9:45 am S&P "flash" U.S. services PMI Tuesday, July 25, 2023: 25-Jul 9:00 am 25-Jul 10:00 am Consumer confidence Wednesday, July 26, 2023: 26-Jul 2:00 am FOMC decision on interest-rate policy 26-Jul 2:30 pm Fed Chairman Powell press conference Thursday, July 27, 2023: 27-Jul 8:30 am Initial jobless claims 27-Jul 8:30 am Durable-goods orders 27-Jul 8:30 am Durable-goods minus transportation 27-Jul 8:30 am GDP (advanced report) 27-Jul 8:30 am Advanced U.S. trade balance in goods 27-Jul 8:30 am Advanced retail inventories 27-Jul 8:30 am Advanced wholesale inventories 27-Jul 10:00 am Pending home sales Friday, July 28, 2023: 28-Jul 8:30 am Personal income (nominal) 28-Jul 8:30 am Personal spending (nominal) 28-Jul 8:30 am PCE index 28-Jul 8:30 am Core PCE index 28-Jul 8:30 am PCE (year-over-year) 28-Jul 8:30 am Core PCE (year-over-year) 28-Jul 8:30 am Employment cost index 28-Jul 10:00 am Consumer sentiment (final) For a chart of typical Up or Down market reactions to specific major US economic reports go to: Economic Indicator Effects
Stocks Covered Today Stock Splits
TRADER'S TIP: "Reversals"
When it comes to reversals on daily charts, the closing price is the key price. Also, it's a good idea to give any reversal from support or resistance at least one day to confirm itself.
Stocks Covered in This Issue
FINANCIAL SERVICES SECTOR
Glacier Bancorp, Inc. (GBCI: Financial Services/Banks-Regional) - SQUEEZE PLAY. When a stock's daily price range contracts to an unusually low point, you can safely assume that in most cases a breakout from that range will result in a nice price move. To capture a portion of this potential movement we have set both a long and a short entry into GBCI. A move to the upside will trigger our BUY entry at 34.38, while a drop to 31.75 will trigger our SELL short entry. Follow your position with a 2.63 trailing stop. Tighten the stop to 1.32 once you have a 1.86 gain. GBCI closed Thursday at 32.88. Earnings Report Date: Oct 18, 2023. Beta: N/A. Market-Cap: 3.646B. Optionable.
HEALTHCARE SECTOR
Silk Road Medical, Inc (SILK: Healthcare/Medical Devices) - BEARISH U-TURN. Sometimes traders hear about a stock that's in trouble and then short it without any thought to timing the entry. This method often results in less profits even when the trade moves in the desired direction. The Bearish U-Turn setup provides a smoother entry than just jumping in. It also reduces risk by placing both the entry trigger and exit stop near the top of the reversal. We'll use this approach with SILK which met our setup requirements on Thursday. The SELL short trigger for this trade is set at 21.48, and the trailing stop is sized at 2.01. Reset the stop to 1.01 upon getting a 3.08 point gain. SILK closed Thursday at 22.39. Earnings Report Date: Aug 01, 2023. Beta: 1.19. Market-Cap: 867.133M. Optionable.
Genelux Corporation (GNLX: Healthcare/Biotechnology) - BEARISH U-TURN. Stocks stuck in a downtrend like GNLX tend to bounce downhill rather than slide lower in a straight line. After interacting with a moving average resistance level on Thursday, GNLX is poised to drop again. To take advantage of this setup, prepare to SELL shares short at 21.97. As usual, follow your entry with a trailing stop. A 3.49 stop will fit GNLX's current price range. Tighten it to 1.75 on a 5.78 gainer. Earnings Report Date: N/A. Beta: N/A. Market-Cap: 606.984M. Not Optionable.
BridgeBio Pharma, Inc. (BBIO: Healthcare/Biotechnology) - SQUEEZE PLAY. BBIO is caught in a dilemma. The stock's compressed price range on Thursday has resulted in a condition comparable to a wound up rubber band. We anticipate that this undecided equity will take off soon, but with the direction still in question we'll let upcoming market action tell us whether to buy shares or sell short. BBIO is now at 32.13. We can capture price action either way by placing a BUY trigger at 33.17 and a SELL short trigger at 30.63. Once BBIO reveals its direction, enter your triggered order and disregard the other one. As soon as your position is in place, follow up with a trailing stop of 2.54. When you acquire a 1.9 profit, tighten the stop to 1.27. Earnings Report Date: Aug 02, 2023. Beta: 0.79. Market-Cap: 5.157B. Optionable.
TECHNOLOGY SECTOR
Ituran Location and Control Ltd. (ITRN: Technology/Communication Equipment) - SQUEEZE PLAY. Thursday's trading action forced ITRN's daily price range into an abnormally narrow state. This translates into opportunity; for the cyclical nature of price volatility is to shrink extensively, then swell rapidly as shares move in one direction or another. Instead of trying to predict the direction ITRN will take when price volatility begins to increase, we'll set both a BUY (long) and a SELL (short) trigger to get us into the right trade. Be ready to BUY shares at 28.42 if ITRN moves higher, and place your order to SELL short at 26.49 if price declines to that level. As usual follow your entry with a trailing stop, 1.93 should be sufficient. Reduce your stop to 0.97 on a 1.32 gain. ITRN closed Thursday at 27.75. Earnings Report Date: Aug 15, 2023. Beta: 1.06. Market-Cap: 558.011M. 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.
Stocks Covered Today Stock Splits
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.
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