The scans didn't produce as many choices as I like, but one good thing about them is that all of them don't require a deep stop. Right now with the market looking a bit indecisive, I would still be careful about expanding exposure. I don't hold a lot of conviction behind today's selections, but tight stops do make them more attractive.
I like what is happening with Gold right now and one of my scans produced seven different Gold funds. I chose one with a good amount of volume, but one you may not be familiar with. Just know that you can select the vehicle of your choice. I currently hold a Gold position.
Before jumping into the other ETFs, you should plan on reading about the strategies used by the money managers. I'm not completely familiar with those ETFs, but I am familiar with the technicals.
If you haven't already, I'd appreciate you subscribing to the new DecisionPoint YouTube channel HERE.
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": BNDD, SGOL and TAIL.
Runner-ups: EWW, DEM and RPAR.
RECORDING & DOWNLOAD LINK (1/26/2024):
Topic: DecisionPoint Diamond Mine (1/26/2024) LIVE Trading Room
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Passcode: January#26
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Topic: DecisionPoint Diamond Mine (2/2/2024) LIVE Trading Room
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Here is the latest recording from January 29th. Click HERE to subscribe to the DecisionPoint YouTube Channel to be notified when new content is available.
Welcome to DecisionPoint Diamonds, wherein I highlight ten "Diamonds in the Rough" per week. These are selected from the results of my DecisionPoint Scans which search for stocks that could benefit from the trend and condition of the market. Remember, these are not recommendations to buy or sell, but are the most interesting of the stocks that surfaced in my scans. My objective is to save you the work of the initial, tedious culling process, but you need to apply your own analysis to see if these stocks pique your interest as well. There are no guaranteed winners here!
"Predefined Scans Triggered" are taken from StockCharts.com using the "Symbol Summary" option instead of a "SharpChart" on the workbench.
Stop levels are all rounded down.
Quadratic Deflation ETF (BNDD)
EARNINGS: N/A
BNDD is an actively managed portfolio of US Treasuries and options strategies tied to the shape of the US interest rate swap curve. Click HERE for more information.
Predefined Scans Triggered: None.
BNDD is down -2.29% which does take the shine off, but it could offer a better entry. I'm bullish on Bonds and this one does seem to travel with them. Of course with the Fed holding things steady for their part, we could see some struggle here at overhead resistance. This one does have a nice yield to go along with it. The RSI did turn down and is in negative territory right now, but the PMO is turning back up and Stochastics are rising strongly. It is beginning to outperform the market. I've set a 4% stop beneath support around $13.84.
This does look like a credible bounce off support. The weekly RSI is negative, but rising. We have the weekly PMO surging above the signal line. The StockCharts Technical Rank (SCTR) is in the basement, well outside the hot zone*. Keep this one in the short-term timeframe for now.
*If a stock is in the "hot zone" above 70, it implies that it is stronger than 70% of its universe (large-, mid-, small-caps and ETFs) primarily in the intermediate to long terms.
abrdn Physical Gold Shares ETF (SGOL)
EARNINGS: N/A
SGOL seeks to track the spot price for gold, less trust expenses holding costs, holding physical gold bars. Click HERE for more information.
Predefined Scans Triggered: Bullish MACD Crossovers and Parabolic SAR Buy Signals.
SGOL is unchanged in after hours trading. Price is moving higher again, but admittedly looks like it is kicking and screaming on its way up with these bearish candlesticks. Still we now have a positive RSI and the PMO is now rising above the zero line. Stochastics just pushed into positive territory and it is beginning to outperform the market. A troubled market could give Gold a boost. I've set the stop well below the 200-day EMA at 5.3% or $18.41.
Gold has been struggling to make another all-time high. This is the fourth time it is making a move toward a breakout. The PMO is on a Crossover BUY Signal and the weekly RSI is positive. The SCTR could definitely use some help so keep this short-term until we see that breakout. Consider an upside target around 17% or $22.76.
Cambria Tail Risk ETF (TAIL)
EARNINGS: N/A
TAIL is an actively managed fund that holds mostly cash and treasuries while using the strategy of buying put options on the S&P 500 with the purpose of portfolio downside protection. Click HERE for more information.
Predefined Scans Triggered: None.
TAIL is unchanged in after hours trading. This fund is seeing a nice bounce off strong support and is headed back to the top of the trading range. This one will do better if the market struggles based on its strategy of buying puts on the SP500. The RSI is now in positive territory. The PMO is turning back up toward a Crossover BUY Signal. Stochastics are rising suggesting we will see more follow through. The ETF is beginning to outperform the market. The stop is thin at only 3% or $12.30.
This weekly chart doesn't look very appetizing given the long-term declining trend, but it is finally bottoming. The weekly PMO looks like it has surged above the signal line, it's unfortunately well below the zero line. The SCTR is in the basement so keep this one in the short-term timeframe.
Don't forget, on Thursdays I look at reader-requested symbols, click HERE to send me an email. I read every email I receive and try to answer them all!
Current Market Outlook:
Market Environment: It is important to consider the odds for success by assessing the market tides. The following chart uses different methodologies for objectively showing the depth and trend of participation for intermediate- and long-term time frames.
- The Silver Cross Index (SCI) shows the percentage of SPX stocks on IT Trend Model BUY signals (20-EMA > 50-EMA)
- The Golden Cross Index (GCI) shows the percentage of SPX stocks on LT Trend Model BUY signals (50-EMA > 200-EMA)
Don't forget that as a "Diamonds" member, you have access to our GCI/SCI curated ChartList on DecisionPoint.com. You'll find it under "Members Only" links on the left side on the Blogs and Links Page.
Here is the current chart:
Full Disclosure: I am 60% long, 0% short.
I'm required to disclose if I currently own a stock I mention and/or may buy/short it within the next 72 hours.
"Technical Analysis is a windsock, not a crystal ball." - Carl Swenlin
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NOTE: The stocks reported herein are from mechanical trading model scans that are based upon moving average relationships, momentum and volume. DecisionPoint analysis is then applied to get five selections from the scans. The selections given should prompt readers to do a chart review using their own analysis process. This letter is not a call for a specific action to buy, sell or short any of the stocks provided. There are NO sure things or guaranteed returns on the daily selection of "Diamonds in the Rough."
Regarding BUY/SELL Signals: The signal status reported herein is based upon mechanical trading model signals and crossovers. They define the implied bias of the price index/stock based upon moving average relationships and momentum, but they do not necessarily call for a specific action. They are information flags that should prompt chart review. Further, they do not call for continuous buying or selling during the life of the signal. For example, a BUY signal will probably (but not necessarily) return the best results if action is taken soon after the signal is generated. Additional opportunities for buying may be found as price zigzags higher, but the trader must look for optimum entry points. Conversely, exit points to preserve gains (or minimize losses) may be evident before the model mechanically closes the signal.
Helpful DecisionPoint Links:
Price Momentum Oscillator (PMO)
Swenlin Trading Oscillators (STO-B and STO-V)
For more links, go to DecisionPoint.com