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Chart of Day: A Second Way to Trade an Amazon Threat

Jul 25, 2017

Just yesterday, we highlighted the opportunity in LOW. Shortly after, the stock was running higher. Today, we’re seeing that same opportunity in Home Depot (HD) after watching it catch and hold support just under $147 a share.

The “Amazon threat” is getting out of hand with HD, too.

But again, all Amazon is doing is making a deal with Sears Holdings – a company near death with heavy debt load.  For Amazon to even enter a deal with a company like Sears is laughable. In our opinion, LOW and HD are both Amazon-proof and among some of the biggest players in the space with nothing to worry about, especially with regards to a deal with Sears. A rebound in LOW and HD is very likely.

We’d like to see a near-term bearish gap refill on HD at $152, which is doable.

There’s far too much fear in HD to ignore this. Plus, as you can see in the chart, it’s oversold on all momentum indicators, including its lower Bollinger Band (2,20), MACD, RSI, Money Flow and Williams’ %R.

In our opinion, it’s only a matter of time before HD bounces back.


Chart of Day: The Amazon-Threat is Laughable Here

Jul 25, 2017

The “Amazon threat” is getting out of hand.

On news that Amazon.com would enter the appliance market, Home Depot (HD) and Lowe’s (LOW) took a big hit. All Amazon is doing is making a deal with Sears Holdings – a company near death with heavy debt load. For Amazon to even enter a deal with a company like Sears is laughable.

In our opinion, LOW and HD are both Amazon-proof and among some of the biggest players in the space with nothing to worry about, especially with regards to a deal with Sears.

A rebound in LOW and HD is very likely.

In fact, LOW is already beginning to recover here. With HD, let’s give it a bit more time before we enter a new position. It has yet to bottom out, technically. But when it does, we’ll jump on it immediately.

For the moment, buy to open the LOW September 15, 2017 75 calls at market.

Chart of Day: Mondelez Ready to Rebound

Jul 19, 2017

Part of the MDLZ is down at the moment is because of a recent cyber attack on June 27, compromising its ability to ship and send invoices in the last days of its second quarter. Preliminary estimates note the attack could cut 3% off its revenue growth rate for the quarter. That's been priced in, though.  We now believe the move lower has been priced in.  What we'd now like to see is a rebound well off oversold relative strength (RSI), MACD and Williams’ %R.

You can either buy the MDLZ at market prices, or buy to open the MDLZ October 2017 45 call at market prices. 

Either way, we believe you should do well.

 

 

 

 

 

Chart of Day: Keep an on ACRX

Jul 19, 2017

Granted, the stock has had a considerable run in recent weeks, but we believe that’s just getting started. Before July 2017 wraps up, the company is expected to wrap a Phase III study of Zalviso, a pain management drug that’s already been approved in Europe. While the company did apply for approval in the U.S, too, the FDA turned them down and requested further studies. The trial began in September 2016 and is expected to wrap up this month. If the data is solid, and can fully address FDA concerns, we could have a potential runner on our hands.

Analysts at Jefferies seem to agree, initiating coverage of the stock with a Buy rating and a $7 price target. They note, “"ACRX is under-valued due to potent oral opioid Dsuvia's promise in medically supervised acute pain markets (~92M patients) and we see high likelihood of U.S./EU approvals in Q4'17/H1'18. Risk/reward is favorable into H1'18 with floor of ~$1.25 (no approvals) vs. $12/share (upside scenario)."

As we near what could be positive news, that wave of anticipatory momentum could continue.

Chart of Day: Opportunity in Gold

Jul 17, 2017

At the moment, shares of GOLD are beginning to pivot and accelerate higher after catching support at the 200-day moving average.  With a good deal of geopolitical tension, we’d like to see a potential break higher with a test of $100 a share.  Plus, as you can see in the chart, momentum metrics are pushing higher, too, on MACD, RSI and Money Flow.  Better yet, with gold prices beginning to firm, too, we have a considerable amount of opportunity here.

There are two ways to trade it here.

One, we can buy to open the GOLD August 2017 90 call and, or we can buy to open the GOLD September 92.50 call.  We believe that both opportunities could pay well.

Gold

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