As I often say, when a big stock name hits the scan results I want to let you know. I would say these two stocks are set up quite well and both made the first cut. They didn't make the second cut primarily because I don't trust them right now. The two names were Microsoft (MSFT) and Netflix (NFLX). I think both charts are constructive, I just sense we will see a downturn and both will likely suffer the consequences.
I opted to include a Consumer Staples stock, something I do trust should the market get shaky. I added a Biotech as I do like what I'm seeing under the hood on the Biotech chart on our website (You'll find it using the link on the left hand side "Under the Hood" ChartList).
The other two were from Materials and Industrials. Both are set up well as you will see.
There are plenty of extra symbols for you to review. It occurred to me that Diamonds subscribers get more than just ten stock/ETF picks per week. If you add in the Runners-up list, you have plenty to review.
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": CASY, CE, EME and VCEL.
Runners-up: AMP, DY, PWR, APAM, GPS, ICE, MORN, NFLX, OLN, SEIC, AMAT and MSFT.
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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.
Caseys General Stores, Inc. (CASY)
EARNINGS: 06/04/2024 (AMC)
Casey's General Stores, Inc. engages in the management and operation of convenience stores and gasoline stations. It provides self-service gasoline, a wide selection of grocery items, and an array of freshly prepared food items. The firm offers food, beverages, tobacco products, health and beauty aids, automotive products, and other non-food items. The company was founded by Donald F. Lamberti in 1968 and is headquartered in Ankeny, IA.
Predefined Scans Triggered: Moved Above Upper Keltner Channel, 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.
CASY is down -0.28% in after hours trading. Today saw a tremendous breakout with trading taking place almost complete above prior resistance. This prevented a bearish double top from forming. The RSI is positive and we have a new PMO Crossover BUY Signal above the zero line. Stochastics are almost above 80. Relative strength for the group is not good, but CASY is outperforming the SPY and that is what counts. The stop is set beneath support at 7.6% or $304.79.
We have a very nice rising trend on the weekly chart with a breakout to new 52-week highs. The weekly RSI is overbought a bit, but that condition will likely persist as it has been. The weekly PMO has surged above the signal line and the StockCharts Technical Rank (SCTR) is in the hot zone* above 70. Consider an upside target of 17% to about $385.94.
*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.
Celanese Corp. (CE)
EARNINGS: 05/08/2024 (AMC) ** Reports Tomorrow! **
Celanese Corp. engages in the provision of technology and specialty materials businesses. It operates through the following segments: Engineered Materials, Acetate Tow, Acetyl Chain and Other Activities. The Engineered Materials segment includes the engineered materials business, food ingredients business and certain strategic affiliates. The Acetate Tow segment serves consumer-driven applications and is a global producer and supplier of acetate tow and acetate flake used in filter products applications. The Acetyl Chain segment includes the integrated chain of intermediate chemistry, emulsion polymers and ethylene vinyl acetate (EVA) polymers businesses, based on similar products, production processes, classes of customers and selling and distribution practices as well as economic similarities over a normal business cycle. The Other Activities segment consists of corporate center costs, including administrative activities such as finance, information technology and human resource functions, interest income and expenses associated with financing activities. The company was founded by Camille Dreyfus and Henri Dreyfus in 1918 and is headquartered in Irving, TX.
Predefined Scans Triggered: New CCI Buy Signals, Moved Above Upper Bollinger Band, Moved Above Ichimoku Cloud and P&F Low Pole.
CE is up +0.17% in after hours trading. It does report after the bell tomorrow, but this melt up into earnings looks quite good. I'm not insisting you go in beforehand, just commenting on the ground being fertile for a rally. I like the basing pattern that it has come out of. The RSI is positive and not overbought. We have a new PMO Crossover BUY Signal above the zero line. Stochastics are now above 80. The group isn't performing very well, but CE is against the group and the SPY. The stop is set beneath support at 7.3% or $150.85.
I like how this bottom is coming off support at the 17-week EMA. I do not like the weekly PMO Crossover SELL Signal, but the rest of the chart looks pretty good. There is a positive weekly RSI and the SCTR is in the hot zone. I would just be careful about holding this one too long based on the weekly PMO (unless it turns back up). Consider a 17% upside target to about $190.39.
EMCOR Group, Inc. (EME)
EARNINGS: 07/25/2024 (BMO)
EMCOR Group, Inc. engages in the provision of electrical and mechanical construction, and facilities services. It operates through the following segments: United States Electrical Construction and Facilities Services, United States Mechanical Construction and Facilities Services, United States Building Services, United States Industrial Services, and United Kingdom Building Services. The United States Electrical Construction and Facilities Services segment offers systems for electrical power transmission and distribution. The United States Mechanical Construction and Facilities Services segment is involved in systems for heating, ventilation, air conditioning, refrigeration, and clean-room process ventilation. The United States Building Services segment is composed of operations which provide a portfolio of services needed to support the operation and maintenance of customers' facilities. The United States Industrial Services segment covers operations which provide industrial maintenance and services. The United Kingdom Building Services segment consists of commercial and government site-based operations and maintenance, and facility maintenance and services. The company was founded in 1987 and is headquartered in Norwalk, CT.
Predefined Scans Triggered: New 52-week Highs, P&F Ascending Triple Top Breakout and P&F Double Top Breakout.
EME is up +1.23% in after hours trading. This was my favorite chart today. We have a nice breakout above resistance to new 52-week highs. The PMO is close to a Crossover BUY Signal well above the zero line. Relative strength is rising strongly across the board. Stochastics are above 80 and still rising. The RSI is a bit of a problem in that it is overbought. However, we can see that overbought territory doesn't pose a problem for EME. The stop is set beneath the 20-day EMA and below the prior low at 7.9% or $345.73.
Beautiful breakout on the weekly chart. Again we have a problem with overbought conditions, this time on the weekly RSI. We do see it isn't as overbought as it has been though. The weekly PMO is rising albeit overbought. The SCTR is at the top of the hot zone implying this one could be considered for an intermediate-term investment. Consider a 17% upside target to $439.20.
Vericel Corp. (VCEL)
EARNINGS: 05/08/2024 (BMO)
Vericel Corp. engages in the research, product development, manufacture, and distribution of patient-specific, expanded cellular therapies for use in the treatment of patients with diseases. Its product portfolio includes MACI and Epicel. The MACI portfolio is FDA-approved product that applies the process of tissue engineering to grow cells on scaffolds using healthy cartilage tissue from the patient's own knee. The Epicel portfolio provide skin replacement for patients who have deep dermal or full thickness burns. The company was founded on March 24, 1989 and is headquartered in Cambridge, MA.
Predefined Scans Triggered: Elder Bar Turned Green, New CCI Buy Signals and Moved Above Ichimoku Cloud.
VCEL is unchanged in after hours trading. It reports earnings before the open so you'll get a sneak peek before you might enter. I like today's strong rally leading up to earnings. It hasn't overcome resistance yet, but we do have bullish indicators that suggest it will. The RSI is positive and not overbought. The PMO has just triggered a Crossover BUY Signal above the zero line. Stochastics are now above 80. Relative strength studies show rising trends which is bullish. The stop is set beneath the 50-day EMA at 7.1% or $46.00.
At first I was not happy with the weekly chart until I realized the weekly PMO just surged or bottomed above the signal line. The weekly RSI is positive and not overbought and the SCTR is well within the hot zone. If it can overcome resistance it does have strong upside potential.
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 30% long, 0% short. Debating adding to my portfolio, but all four are on my radar, particularly EME.
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