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     03/10     03/10      Buy      Short   Trailing Stops     Gain 
Symbol    Price      +/-      Entry     Entry   Initial/Tighten   Amount 
------  --------  --------  --------  --------  ---------------  --------

SE        50.69      4.78     51.44                  5.07/2.54      2.90
JD        41.80      1.89     43.13                  3.75/1.88      2.10
CPB       51.26      1.06     52.15                  4.72/2.36      1.28
EVSI      10.19      0.41     11.12                  2.04/1.02      1.42

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 access to the Risk Calculator, go to http://www.rightline.net and login to the Member's area.

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

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Market Summary

Stocks rallied on Tuesday in a highly volatile session as trader expectations increased for Federal Reserve Bank intervention due to the coronavirus. The USD/dollar and treasury yields rebounded, oil and gasoline prices continued to drop to the delight of motorists around the globe, while gold declined. In equities, Stitch Fix (SFIX $16) lowered its full-year guidance, Delta Air Lines (DAL $45) announced capacity cuts, and Dick's Sporting Goods (DKS $36) rose following its upbeat earnings announcement that included a dividend increase. Light economic news included an uptick in business optimism.

                        Mar 9, 2020            Mar 10, 2020   
                  --------------------   --------------------
Dow                    23,851   -2,014        25,018   +1,167
Nasdaq               7,950.68  -624.94      8,344.25  +393.58
S&P 500                 2,747  -225.81         2,882  +135.67

NYSE Volume                      8.37B                  7.70B
NYSE Advancers                      70                   2304
NYSE Decliners                    2973                    696

Nasdaq Volume                    4.53B                  4.47B
Nasdaq Advancers                   166                   2241
Nasdaq Decliners                  3190                   1070

                                 New Highs/Lows

                   03/03  03/04  03/05  03/06  03/09  03/10
                 --------------------------------------------
NYSE New Highs        27     41     38     28     15     13
NYSE New Lows        171    134    389    714   1620    688
Nasdaq New Highs      77     66     57     62     53     16
Nasdaq New Lows      180    128    373    623   1406    704
   

TRADER'S TIP: "Turning Hunter-Gatherers Into Investors"

Studies show that when it comes to intelligent investing, human beings just aren't wired very well. Investors are emotionally driven, and are usually unaware of their own self-destructive behavior. The instinctive "fight or flight" response in each of us serves an important purpose, but it doesn't lend itself to the capital markets. For example, in one study the majority of investors sold their winning positions to make up for losers, then held the losers way too long in hopes they would recover. This is the opposite of what should be done. Winning stocks tend to keep on winning, while losers usually keep losing. The most common management strategy used by successful traders is pretty simple. Get rid of losers quickly, and keep winners profitable with a stop order based exit strategy.

The Technical Analyst

For help with this chart, be sure to read "Understanding The Importance Of Support And Resistance"
and "Boost Your Profits With Moving Averages".

S&P 500 - 2882.23 March 10, 2020

52-Week High: 3393.52
52-Week Low: 2728.81
Daily Trend: DOWN
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 3473.90
Resistance 2: 3238.72
Resistance 1: 3105.54
Pivot: 3003.54
Support 1: 2870.36
Support 2: 2768.36
Support 3: 2533.18


NASDAQ Composite - 8344.25 March 10, 2020

52-Week High: 9838.37
52-Week Low: 7292.22
Daily Trend: DOWN
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 10064.07
Resistance 2: 9368.88
Resistance 1: 8972.25
Pivot: 8673.69
Support 1: 8277.06
Support 2: 7978.50
Support 3: 7283.31
        
Dow Industrials - 25018.16 March 10, 2020

52-Week High: 29568.57
52-Week Low: 23690.34
Daily Trend: DOWN
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 29816.02
Resistance 2: 27940.30
Resistance 1: 26902.53
Pivot: 26064.58
Support 1: 25026.81
Support 2: 24188.85
Support 3: 22313.13
 

Market Calendar

ECONOMIC REPORTS AND EVENTS (all times are Eastern):    

Monday, March 09, 2020:
09-Mar          None scheduled

Tuesday, March 10, 2020:
10-Mar   6 am   NFIB small business index

Wednesday, March 11, 2020:
11-Mar  8:30 am   Consumer price index
11-Mar  8:30 am   Core CPI
11-Mar   2 pm   Federal budget

Thursday, March 12, 2020:
12-Mar  8:30 am   Weekly jobless claims
12-Mar  8:30 am   Producer price index
12-Mar  12 noon   Financial accounts of the U.S.

Friday, March 13, 2020:
13-Mar  8:30 am   Import price index
13-Mar  10 am   Consumer sentiment index



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

TRADER'S TIP: "Profits"

Most profits usually come from a relatively few big winning trades, while the remaining positions are made up of numerous small gainers and losers. This comes as a surprise to many traders, for most assume that a very high win-to-loss ratio is necessary to succeed in the markets. In fact, trying to maintain a high win-to-loss ratio usually results in traders taking small gainers too early, before the position can develop into it's full potential.

At the same time there is a tendency to ignore losers, to hope that they will reverse and turn into winners. While this is a common strategy for beginners, professionals know that it just doesn't work. All it takes is one big loser to undo several positive trades, so concentrate first on minimizing losses, then look to maximize gains by locking in profits as they accumulate.

Stocks Covered in This Issue

COMMUNICATION SERVICES SECTOR

Sea Limited (SE: Communication Services/Electronic Gaming & Multimedia) - BULLISH BOUNCE. Among other strengths, the Bullish Bounce protects traders from buying a stock "at the top" of its current cycle. The entry into this setup always takes place in upward-moving stocks that have retreated a bit under normal conditions. Now sitting at 50.69, SE is on our radar for a BUY entry at 51.44. If you purchase shares of SE, be sure to also place a trailing stop of 5.07. Snug it up to 2.54 on a 2.90 gain. Earnings Report Date: N/A. Beta: 1.39. Market-Cap: 23.482B. Optionable.

CONSUMER CYCLICAL SECTOR

JD.com, Inc. (JD: Consumer Cyclical/Internet Retail) - NEW HIGH DIP. The price momentum required to set a new high doesn't usually disappear over night. Traders can capitalize on this fact by entering positions when stocks making new highs pull back to a support level, then follow the pullback with signs of bouncing higher. JD meets the setup criteria, so get ready to BUY into this outstanding performer at 43.13. Enter a trailing stop of 3.75 when your order is filled, then tighten it to 1.88 on a 2.10 gain. Earnings Report Date: May 07, 2020. Beta: 1.26. Market-Cap: 61.035B. Optionable.

CONSUMER DEFENSIVE SECTOR

Campbell Soup Company (CPB: Consumer Defensive/Packaged Foods) - NEW HIGH DIP. The best stocks move steadily higher in a two-steps-forward and one-step-back series of repetitive new highs. CPB reached a new 52-week high a few days ago and has since retreated into Tuesday's encounter with moving average support. A bounce appears to be in the making, so prepare to pick up a few shares should CPB move up to our BUY trigger at 52.15. Post a 4.72 trailing stop which should be tightened to 2.36 after gaining 1.28. Earnings Report Date: Jun 02, 2020. Beta: 0.49. Market-Cap: 15.467B. Optionable.

TECHNOLOGY SECTOR

Envision Solar International, Inc. (EVSI: Technology/Solar) - NEW HIGH DIP. For a stock, the ladder to the top has rungs made up of 52-week highs. Each step up is followed by profit taking that usually causes a temporary pullback. The New High Dip setup uses these dips for safe entries into strong stocks. EVSI is now showing strength, so plan to BUY shares when this winner reaches our trigger at 11.12. Follow your position with a 2.04 trailing stop, which you can tighten to 1.02 when you have gained 1.42 points. EVSI last closed at 10.19. Earnings Report Date: N/A. Beta: -0.11. Market-Cap: 52.382M. Not 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  
---------------- -------     --------    -------     ------  -------   

Currently there are no upcoming stock splits on the major US exchanges.
    

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 to all RightLine subscribers. For access, go to http://www.rightline.net and login to the Member's area.

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