March 19, 2024 - The RightLine Report
Notes From The Editor
I'm amazed at how untested beliefs and opinions influence one's ability to make money. For example, some traders think a complicated trading system is needed in order to be successful. In fact nothing could be further from the truth. Though misunderstood and misapplied, the old adage to "keep it simple" is still effective in most areas of life - and especially true in the stock market.
I grew up in a typical American neighborhood with the usual opinions about money. Our beliefs were grounded in the good old-fashioned work ethic. It was made very clear that the harder we worked, the better things would get. In a number of ways this was true - the hard work did pay off for many. However, there were plenty of folks in our community who worked very hard and were never able to reach a comfortable level of success.
As time went by I began to realize that hard work wasn't the only important factor in financial achievement. At the same time I became aware that some of my beliefs about money and the markets weren't helping me. I was convinced that the capital game was like an elaborate maze, a sort of complex high-stress puzzle that could only be solved using sophisticated means. In my early trading days I fell into the trap of thinking that technology was the solution.
There's no question that technology helps us trade more effectively, yet only if our method is reliable. "Reliable" doesn't mean complex. Over the years I've found that most successful trading methods are fairly simple.
Complex doesn't always equal better. On the flip side, over-simplification can have negative effects. All successful traders maintain a balance, with most leaning toward the simpler side of the equation.
Just remember that when trimming back unneeded elements in your trading approach, be sure to avoid increasing risk. Also include some type of technical analysis that uses support and resistance to time entries and exits. And yes, keep that risk management component in place to prevent account damage.
Trade well,
~ Thomas Sutton, Editor
Stocks Covered Today Stock Splits
Quick List
Stock 03/19 03/19 Buy Short Trailing Stops Gain
Symbol Price +/- Entry Entry Initial/Tighten Amount
------ -------- -------- -------- -------- --------------- --------
MYGN 21.60 -0.03 22.21 20.79 1.42/0.71 2.36
SNDX 22.22 0.29 22.75 21.06 1.69/0.85 2.2
RGNX 22.39 0.05 23.26 21.32 1.94/0.97 4.36
DQ 26.23 0.02 26.79 2.01/1.01 2.26
PAY 22.39 0.01 22.89 21.17 1.72/0.86 1.24
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
Stocks ended the day higher on Tuesday, recovering from morning losses, with the S&P 500 posting a 0.6% gain. Leading the charge were sectors such as energy, consumer discretionary, and utilities within the S&P 500, each registering around a 1% increase.
Meanwhile, Asian markets showed a mixed performance overnight following the Bank of Japan's decision to lift policy rates out of negative territory for the first time since 2016. Treasury yields dipped, with the 10-year yield settling at approximately 4.3%, while the 2-year yield closed around 4.7%. In Canada, inflation data surprised to the downside, with headline consumer price index (CPI) inflation rising by 2.8% year-over-year, falling short of the consensus expectation of a 3.1% increase.
Attention now turns to WEdnesday's FOMC meeting, where the Fed is anticipated to maintain policy rates at 5.25% - 5.5%. Alongside the policy-rate decision, updated economic projections will be released, with a particular focus on the year-end fed funds rate projection. Median Fed projections from December pointed to a 2024 year-end fed funds rate of 4.6%, indicating approximately three 0.25% interest-rate cuts from the current rate.
In housing market news, February's data showed strength, with housing starts and building permits surpassing consensus expectations. Housing starts reached a seasonally adjusted annual rate of 1.52 million, up nearly 11% from January and roughly 6% higher than February 2023. Building permits for privately owned housing units, a leading indicator for future construction, were also at a seasonally adjusted annual rate of 1.52 million in February, representing a 2.4% increase from the previous year. Despite challenges posed by higher interest rates, resilient construction activity, fueled in part by limited supply of existing homes for sale, bodes well for US economic growth in the coming quarters, especially if the Fed enacts anticipated rate cuts and mortgage rates decrease.
Mar 18, 2024 Mar 19, 2024
-------------------- --------------------
Dow 38,790.51 75.74 39,110.76 320.33
Nasdaq 16,103.45 130.27 16,166.79 63.34
S&P 500 5,149.49 32.40 5,178.51 29.09
NYSE Volume 4.06B 4.04B
NYSE Advancers 1,430 1,949
NYSE Decliners 1,386 866
Nasdaq Volume 5.04B 4.77B
Nasdaq Advancers 1,882 2,482
Nasdaq Decliners 2,388 1,755
New Highs/Lows
03/12 03/13 03/14 03/15 03/18 03/19
--------------------------------------------
NYSE New Highs 180 282 138 106 141 175
NYSE New Lows 25 23 59 53 39 34
Nasdaq New Highs 131 189 95 84 97 93
Nasdaq New Lows 125 121 196 140 128 126
Stocks Covered Today Stock Splits
TRADER'S TIP: "Hi-Tech Trading Platforms"
A direct access trading platform will help a good trader make more money, but it does nothing for those who are still trying to grasp the basics of the stock market. Success in this business is more dependent on accurate chart interpretation than buying the newest hi-tech software or hardware.
Huge profits are made each month by long-time professional traders who still use the phone to place their orders and manage open positions. As your execution and trade management abilities improve, it becomes obvious that what you know is far more important to your bottom line than any state-of-the-art trading platform.
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".
Stocks Covered Today Stock Splits
Market Calendar
ECONOMIC REPORTS AND EVENTS (all times are Eastern): MONDAY, MARCH 18 10:00 am Home builder confidence index TUESDAY, MARCH 19 8:30 am Housing starts Feb 8:30 am Building permits Feb WEDNESDAY, MARCH 20 2:00 pm FOMC interest-rate decision 2:30 pm Fed Chair Powell press conference THURSDAY, MARCH 21 8:30 am Initial jobless claims 8:30 am Philadelphia Fed manufacturing survey 9:45 am S&P flash U.S. services PMI 9:45 am S&P flash U.S. manufacturing PMI 10:00 am U.S. leading economic indicators 10:00 am Existing home sales FRIDAY, MARCH 22 None scheduled 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: "Using The Market Map"
While Charting and Technical Analysis gives us a map of the market by revealing the price levels where trading decisions need to be made, it doesn't make those decisions for us. It's our job as traders to pilot the journey by entering positions and taking the right exits along the way!
Stocks Covered in This Issue
HEALTHCARE SECTOR
Myriad Genetics, Inc. (MYGN: Healthcare/Diagnostics & Research) - SQUEEZE PLAY. Sometimes when Bulls and Bears face off in the market arena for a typical day-long battle, there is no clear winner. This is evident when the daily price range contracts to an unusually narrow state. MYGN found itself in this condition on Tuesday when neither buyers or sellers were able to push ahead. This setup provides traders a chance to hop on board the next breakout - whether it's to the upside or down - with little risk of loss. To do this place a BUY order at 22.21 and a SELL short trigger at 20.79. When MYGN moves outside of Tuesday's range, one of the orders will be filled. Once you hold a position of shares, cancel the unfilled order and place a 1.42 trailing stop. After you've got a 2.36 profit, tighten the stop to 0.71. MYGN closed at 21.60 on Tuesday. Earnings Report Date: May 01, 2024. Beta: 1.96. Market-Cap: 1.941B. Optionable.
Syndax Pharmaceuticals, Inc. (SNDX: Healthcare/Biotechnology) - SQUEEZE PLAY. SNDX shareholders know what it feels like to be squeezed. Tuesday's slim price range reveals uncertainty on both sides of the table, a situation which often resolves itself by either Bears or Bulls quickly gaining a clear advantage. The question is "who will win?" Near-term market action tell us whether we should sell short or we should buy shares instead. SNDX closed Tuesday at 22.22. The plan is to enter in the right direction by placing a BUY trigger at 22.75 and a SELL short trigger at 21.06. Once SNDX establishes direction, place your triggered order. As soon as you are in the trade, place a trailing stop in the amount of 1.69. After you've collected a 2.2 profit, tighten the stop to 0.85. Earnings Report Date: May 06, 2024. Beta: 1.03. Market-Cap: 1.888B. Optionable.
REGENXBIO Inc. (RGNX: Healthcare/Biotechnology) - SQUEEZE PLAY. Tuesday's trading session left RGNX 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 23.26 and your SELL short trigger at 21.32. One of the orders will be triggered by upcoming price action. When your market order is filled, cancel the remaining trigger and enter a 1.94 trailing stop. Once you have a 4.36 profit, reduce the stop to 0.97. Earnings Report Date: May 01, 2024. Beta: 1.27. Market-Cap: 1.097B. Optionable.
TECHNOLOGY SECTOR
Daqo New Energy Corp. (DQ: Technology/Semiconductor Equipment & Materials) - BULLISH BOUNCE. If you are looking for another bouncer with profits in mind, DQ fits the bill. Shares have been in retreat-mode lately, but now this stock is in the process of bouncing from support. Currently priced at 26.23, plan to buy shares at 26.79 and use a 2.01 trailing stop. Tighten the stop to 1.01 on a 2.26 gain. Earnings Report Date: Apr 25, 2024. Beta: 0.18. Market-Cap: 1.725B. Optionable.
Paymentus Holdings, Inc. (PAY: Technology/Software - Infrastructure) - SQUEEZE PLAY. The ticker for Tuesday's session shows PAY is now stuck in a tight price band. With the cyclical contraction and expansion nature of volatility in force, we should see a new period of price expansion in the days ahead. To improve the odds of catching the next directional wave, place a BUY trigger at 22.89 and a SELL short trigger at 21.17. When PAY starts moving out of its narrow range, your order will be triggered. Once you're in the trade, cancel the opposing trigger and set a 1.72 trailing stop. Upon reaching a 1.24 profit, resize the stop to 0.86. Earnings Report Date: N/A. Beta: 1.40. Market-Cap: 2.775B. 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.
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