I only had three people submit reader requests today. I was able to take one from each of their selections. Feel free to send in one or more symbol requests by Thursday. It is more fun when I have a large group to choose from.
I'm still under the weather and there really isn't much to add. I think all three selections are worthwhile, there is the issue of some of these winners getting overbought. A pullback on any of these would offer a nice entry.
Be sure to register to attend tomorrow's Diamond Mine trading room! We'll run some scans and find some new prospects!
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": ABNB, LYFT and TPH.
Other requests: MSOS, ANET, ONON, AIT, TPH, PTC, RMBS, AOS and WOLF.
RECORDING & DOWNLOAD LINK (3/15/2024):
Topic: DecisionPoint Diamond Mine (3/15/2024) LIVE Trading Room
Recording & Download LinkHERE.
Passcode: March#15th
REGISTRATION for 3/22/2024:
When: Mar 22, 2024 09:00 AM Pacific Time (US and Canada)
Topic: DecisionPoint Diamond Mine (3/22/2024) LIVE Trading Room
Register in advance for this webinar HERE.
After registering, you will receive a confirmation email containing information about joining the webinar.
Here is the latest recording from 3/18. 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.
Airbnb Inc. (ABNB)
EARNINGS: 05/07/2024 (AMC)
Airbnb, Inc. engages in the management and operation of an online marketplace. Its marketplace model connects hosts and guests online or through mobile devices to book spaces. The company was founded by Brian Chesky, Nathan Blecharczyk and Joseph Gebbia in 2007 and is headquartered in San Francisco, CA.
Predefined Scans Triggered: New CCI Buy Signals, New 52-week Highs, Parabolic SAR Buy Signals, P&F Double Top Breakout and P&F Triple Top Breakout.
ABNB is up +0.20% in after hours trading. I like today's intraday breakout from what looks like a flag formation formed at the end of February into March. The RSI is not overbought at all. The PMO is back on a Crossover BUY Signal. The PMO is also flat well above the zero line which implies pure strength. Stochastics are rising in positive territory. I really liked relative strength as all strength line are trending higher. I've set the stop at 7.4%, close to the 50-day EMA at $155.73.
The weekly chart is very strong and suggests some serious upside potential. The RSI is getting overbought which is a concern, but this rally looks solid out of the October low. The weekly PMO is on a Crossover BUY Signal and is rising. It isn't overbought because we have negative readings around -10, meaning +10 is the upper boundary. The StockCharts Technical Rank (SCTR) is in the hot zone* above 70.
*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.
Lyft Inc. (LYFT)
EARNINGS: 05/02/2024 (AMC)
Lyft, Inc. engages in the provision and management of an online social rideshare community platform. It offers access to a network of shared bikes and scooters for shorter rides and first mile and last-mile legs of multimodal trips, information about nearby public transit routes, and Lyft Rentals to offer riders a view of transportation options when planning any trip. The company was founded by Marcus Cohn, John Zimmer, Rajat Suri, Matt van Horn, and Logan Green in 2007 and is headquartered in San Francisco, CA.
Predefined Scans Triggered: Moved Above Upper Keltner Channel, New 52-week Highs, Moved Above Upper Bollinger Band, Stocks in a New Uptrend (Aroon), P&F Ascending Triple Top Breakout and P&F Double Top Breakout.
LYFT is up +0.59% in after hours trading. Today's breakout was spectacular. The RSI is getting overbought so a pullback would make this one prime for entry. Volume is coming in hot. The PMO has whipsawed back into a Crossover BUY Signal well above the zero line. Stochastics are rising above 80 suggesting internal price strength. Relative strength lines are rising strongly for LYFT. The group is also outperforming somewhat. The stop is set beneath new support as deep as I was comfortable with at 7.6% or $18.73.
The weekly chart does show long-term resistance right up ahead so a pullback could ensue. The weekly RSI is getting overbought but still has room to move higher. The weekly PMO is very favorable well above the zero line. The SCTR tells us this could be ripe for an intermediate-term timeframe.
Tri Pointe Homes Inc. (TPH)
EARNINGS: 04/25/2024 (BMO)
Tri Pointe Homes, Inc. designs, constructs, and sells single-family homes and condominiums. It operates through the Homebuilding and Financial Services segments. The Homebuilding segment consists of six reportable segments: Maracay Homes, consisting of operations in Arizona, Pardee Homes, consisting of operations in California and Nevada, Quadrant Homes, consisting of operations in Washington, Trendmaker Homes, consisting of operations in Texas, TRI Pointe Homes, consisting of operations in California and Colorado, and Winchester Homes, consisting of operations in Maryland and Virginia. The Financial Services segment consists of its TRI Pointe Connect mortgage financing operations and its TRI Pointe Assurance title services operations. The company was founded in April 2009 and is headquartered in Incline Village, NV.
Predefined Scans Triggered: New 52-week Highs, Moved Above Upper Bollinger Band, Moved Above Upper Price Channel, P&F Ascending Triple Top Breakout and P&F Double Top Breakout.
TPH is unchanged in after hours trading. We have a nice breakout from an intermediate-term trading range. The RSI is rising and is not at all overbought so it can accommodate more upside. There is a new PMO Crossover BUY Signal and Stochastics are rising strongly. The group is doing well and I like it given XHB, the Homebuilders ETF was a selection yesterday. TPH is starting to show leadership among the group and is outperforming the SPY. The stop is set beneath the 50-day EMA at 6.4% or $34.25.
We could look at the current breakout as a break from a bull flag formation. I'm not fond of sideways flags, but this breakout is confirming the pattern. It would suggest plenty of upside ahead with an upside target taking price to $48.50. I don't want to get that bullish, but the chart does imply more rally. The weekly RSI is not overbought and we have a whipsaw BUY Signal on the weekly PMO well above the zero line suggesting strength. The SCTR is not in the hot zone yet, but it is close enough to pass muster. Still keep this one short-term until it gets in the hot zone.
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 65% 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