March 30, 2023 - The RightLine Report
Notes From The Editor
Trading as a Business
Do you trade for a living, or do you trade to supplement the income you get from a regular job? In either case, trading is something that's inherently entrepreneurial. You're a) working for yourself, b) risking capital to make money, and c) trying to achieve a steady flow of income. Essentially, it's a business.
This approach is a big shift from the perspective that many traders have. They tend to think of the whole endeavor as something more akin to gambling - a novel way to earn an extra bit of cash every week. The way I see it, the business perspective is far more useful. It makes sense in the context of an ever-changing stock market, and helps you position yourself to reach your goals.
Every business is forced to pay taxes, and it's no different with trading. There are certain rules that dictate how much you must fork over to Uncle Sam, depending on how often you trade and other factors. A little research in this area can yield some helpful, money-saving information.
Profitable businesses also have reliable, efficient internal systems. To put it another way, they apply good habits and business practices consistently to improve their chances of success. Traders can use the same methodical approach to their advantage. This means consistent use of risk management and stop-loss methods, a non-emotional, calculated approach to entering trades, and good record-keeping.
Every successful firm knows that professionalism and profits go hand-in-hand. Organize everything about your trading for maximum efficiency. Clear your mind of other details when making decisions or executing trades, and focus on the task at hand. Act like a pro!
Businesses also need to be acutely aware of the marketplace, their own strengths and shortcomings, and any future trends that might have an impact on their ability to make money. With that in mind, in the next RightLine Report I'll introduce you to a common business planning tool that's just as useful in the trading world.
Here's to profits,
Kent Barton
Senior Analyst
Stocks Covered Today Stock Splits
Quick List
Stock 03/30 03/30 Buy Short Trailing Stops Gain
Symbol Price +/- Entry Entry Initial/Tighten Amount
------ -------- -------- -------- -------- --------------- --------
HZO 27.83 -0.45 26.94 2.63/1.32 2.44
ATEC 15.79 0.35 16.06 1.02/0.51 1.74
COLL 24.37 0.37 24.72 23.28 1.44/0.72 1.96
INTT 20.23 0.67 20.52 19.09 1.43/0.72 2.08
ASAN 20.05 0.02 20.77 19.32 1.45/0.73 2.68
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
The US stock markets inched higher on Thursday as the odds of a full-blown banking crisis are declining. The session gain was broad-based, with nearly all sectors in the S&P 500 moving higher. Only the financial sector failed to participate in the upward move, as Treasury Secretary Janet Yellen called for tougher regulation of the banking industry after Silicon Valley Bank and other banks imploded earlier this month. The Nasdaq 100, home to massive tech firms like Apple (AAPL), Alphabet (GOOGL), Amazon (AMZN), Microsoft (MSFT), and computer-chip designer NVIDIA (NVDA), has entered bull market territory after having regained 20% from its lows in 2022. The Fed's aggressive interest rate campaign this past year has weighed heavily on the tech sector, since growth stocks tend to be more sensitive to rising interest rates. Now that the market expects the Federal Reserve Bank to soon begin lowering interest rates, the sector will likely benefit from the rsing optimism. Oil prices, gold and the 10-year treasury yield were all lower, the USD/dollar finished near even.
Mar 29, 2023 Mar 30, 2023
-------------------- --------------------
Dow 32,717.60 323.35 32,859.03 141.43
Nasdaq 11,926.24 210.16 12,013.47 87.24
S&P 500 4,027.81 56.54 4,050.83 23.02
NYSE Volume 4.16B 3.94B
NYSE Advancers 2,389 2,096
NYSE Decliners 635 924
Nasdaq Volume 4.54B 4.75B
Nasdaq Advancers 3,048 2,391
Nasdaq Decliners 1,436 2,045
New Highs/Lows
03/23 03/24 03/27 03/28 03/29 03/30
--------------------------------------------
NYSE New Highs 31 23 34 27 41 44
NYSE New Lows 212 260 34 50 20 16
Nasdaq New Highs 57 42 63 43 68 75
Nasdaq New Lows 314 333 147 147 143 153
Stocks Covered Today Stock Splits
TRADER'S TIP: "Every Day Is A New Day"
Traders should assume nothing about future market direction. Begin each day unbiased, and let the price action determine whether you're bullish or bearish.
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 - 4050.83 March 30, 2023
52-Week High: 4603.07
52-Week Low: 3491.58
Daily Trend: UP
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 4233.87
Resistance 2: 4103.54
Resistance 1: 4037.26
Pivot: 3973.21
Support 1: 3906.93
Support 2: 3842.88
Support 3: 3712.55
NASDAQ Composite - 12013.47 March 30, 2023
52-Week High: 14534.38
52-Week Low: 10088.83
Daily Trend: UP
Weekly trend: UP
Weekly Pivot Levels
Resistance 3: 12722.81
Resistance 2: 12259.51
Resistance 1: 12041.73
Pivot: 11796.21
Support 1: 11578.43
Support 2: 11332.91
Support 3: 10869.61
Dow Industrials - 32859.03 March 30, 2023
52-Week High: 35492.22
52-Week Low: 28660.94
Daily Trend: UP
Weekly trend: DOWN
Weekly Pivot Levels
Resistance 3: 34181.62
Resistance 2: 33224.91
Resistance 1: 32731.22
Pivot: 32268.20
Support 1: 31774.51
Support 2: 31311.49
Support 3: 30354.78
Stocks Covered Today Stock Splits
Market Calendar
ECONOMIC REPORTS AND EVENTS (all times are Eastern): MONDAY, MARCH 27 5:00 pm Fed Gov. Jefferson speaks TUESDAY, MARCH 28 8:30 am Advanced U.S. trade balance in goods 8:30 am Advanced retail inventories Feb. 8:30 am Advanced wholesale inventories 9:00 am S&P Case-Shiller home price index (20 cities) 9:00 am FHFA home price index 10:00 am U.S. consumer confidence 10:00 am Fed Gov. Barr testifies to Senate on banks WEDNESDAY, MARCH 29 10:00 am Pending U.S. home sales 10:00 am Fed Gov. Barr testifies to House on banks THURSDAY, MARCH 30 8:30 am GDP (2nd revision) 8:30 am Initial jobless claims 8:30 am Continuing jobless claims 12:45 pm Boston Fed President Collins speaks FRIDAY, MARCH 31 8:30 am Personal income (nominal) 8:30 am Personal spending (nominal) 8:30 am PCE index] 8:30 am Core PCE index 8:30 am PCE (year-over-year) 8:30 am Core PCE (year-over-year) 9:45 am Chicago Business Barometer 10:00 am Consumer sentiment (final) 10:00 pm Fed Gov. Waller speaks 3:05 pm New York Fed President Williams speaks 5:45 pm Fed Gov. Cook speaks 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: "Everybody In The Pool!"
Like swimming, trading can be awkward and uncomfortable sometimes - especially when we get water up our noses. Here's a wee bit of advice from a former flounderer - don't be discouraged, just stay in the pool. What starts with a lot of effort and splashing around soon becomes a pleasurable experience for those who don't give up.
Stocks Covered in This Issue
CONSUMER CYCLICAL SECTOR
MarineMax, Inc. (HZO: Consumer Cyclical/Specialty Retail) - BEARISH U-TURN. The weekly trend for HZO is down, but recent daily price activity has lifted shares upward in what's known as a "counter-trend" bounce. As the name implies, this type of rebound is against the main trend. These bounces tend to revert back to the direction of the main trend - in this case downward - once the bounce reaches significant resistance. This is exactly the situation HZO finds itself in, as Thursday's recoil from moving average resistance presents the beginnings of a possible return to the weekly downtrend. HZO now sits at 27.83 after reaching an intra-day high of 29.19 during the latest session. Place a short-SELL order with your broker if price drops to the 26.94 level. Follow your entry with a trailing stop of 2.63 and tighten to 1.32 on a 2.44 profit. Earnings Report Date: Apr 26, 2023. Beta: 1.48. Market-Cap: 608.183M. Optionable.
HEALTHCARE SECTOR
Alphatec Holdings, Inc. (ATEC: Healthcare/Medical Devices) - BULLISH BOUNCE. The charts for ATEC show that despite the downward pressure from sellers recently, the weekly uptrend is still going strong. Buyers showed up again on Thursday, 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 16.06, and follow your entry with a trailing stop of 1.02. Tighten it to 0.51 when a 1.74 profit is reached. ATEC ended the latest session at 15.79. Earnings Report Date: May 03, 2023. Beta: 1.25. Market-Cap: 1.754B. Optionable.
Collegium Pharmaceutical, Inc. (COLL: Healthcare/Drug Manufacturers-Specialty & Generic) - 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 COLL. A move to the upside will trigger our BUY entry at 24.72, while a drop to 23.28 will trigger our SELL short entry. Follow your position with a 1.44 trailing stop. Tighten the stop to 0.72 once you have a 1.96 gain. COLL closed Thursday at 24.37. Earnings Report Date: May 08, 2023. Beta: 0.81. Market-Cap: 830.203M. Optionable.
TECHNOLOGY SECTOR
inTEST Corporation (INTT: Technology/Semiconductor Equipment & Materials) - SQUEEZE PLAY. Thursday's trading action forced INTT'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 INTT 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 20.52 if INTT moves higher, and place your order to SELL short at 19.09 if price declines to that level. As usual follow your entry with a trailing stop, 1.43 should be sufficient. Reduce your stop to 0.72 on a 2.08 gain. INTT closed Thursday at 20.23. Earnings Report Date: May 04, 2023. Beta: 1.93. Market-Cap: 229.323M. Optionable.
Asana, Inc. (ASAN: Technology/Software-Application) - SQUEEZE PLAY. ASAN 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. ASAN is now at 20.05. We can capture price action either way by placing a BUY trigger at 20.77 and a SELL short trigger at 19.32. Once ASAN 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 1.45. When you acquire a 2.68 profit, tighten the stop to 0.73. Earnings Report Date: May 30, 2023. Beta: 1.23. Market-Cap: 4.298B. 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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