ETF Scans didn't produce much today so I had to go out on my own for two of the selections. I found these two ETFs using our ETF Tracker ChartList which is available on the website for all subscribers. If you want just the list of symbols from the ChartList so you can make your own, send me an email and I'll get it to you.
The selection that came up in my scans was from the international ETF family, Brazil (EWZ). I had other international ETFs come in including the Latin America ETF (ILF), but I opted for Brazil. You'll see why.
The two from the ETF Tracker are Broker-Dealers (IAI) and Palladium (PALL). Broker-Dealers were visible in my scans yesterday and the chart is bullish enough to include. PALL is a high risk reversal play so be very careful. Think UNG.
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": EWZ, IAI and PALL.
Runners-up: CPER, EUFN, EZA, ILF, EEM, SCHE and FXG.
RECORDING LINK (9/8/2023):
Topic: DecisionPoint Diamond Mine (9/8/2023) LIVE Trading Room
Passcode: Sept#8th
REGISTRATION for 9/15/2023:
When: Sep 15, 2023 09:00 AM Pacific Time (US and Canada)
Topic: DecisionPoint Diamond Mine (9/15/2023) 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 last recording from 9/11:
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.
iShares MSCI Brazil Capped ETF (EWZ)
EARNINGS: N/A
EWZ tracks a market-cap-weighted index of Brazilian firms covering the entire market-cap spectrum. Click HERE for more information.
Predefined Scans Triggered: New CCI Buy Signals, Parabolic SAR Buy Signals and Shooting Star.
EWZ is down -0.09% in after hours trading. The one bad thing about this chart is the bearish shooting star candlestick that implies tomorrow will be a decline for EWZ. Past that everything looks good. There is a bullish double bottom pattern that would imply an upside target at the July high at a minimum should price breakout above the confirmation line. There is a brand new PMO Crossover BUY Signal and the RSI just moved into positive territory. Stochastics are rising strongly. Relative strength against the SPY is rising. The stop is set below support at 6.1% or $29.86.
EWZ has a mixed weekly chart so probably best to keep this as a short-term trade rather than an intermediate-term investment. The weekly RSI is positive and the StockCharts Technical Rank (SCTR) is at the top of the hot zone* above 70. The big problem is the new weekly PMO Crossover SELL Signal. Should it breakout past the minimum upside target of the double bottom pattern, I can see a possible 19.5% gain.
*If a stock/ETF 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.
iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI)
EARNINGS: N/A
IAI tracks a market-cap-weighted index of investment service providers as well as securities and commodities exchanges. Click HERE for more information.
Predefined Scans Triggered: None.
IAI is unchanged in after hours trading. Here we have another bullish double bottom pattern. Price nearly closed above the confirmation line yesterday. Today it struggled with overhead resistance. I'd feel better about this one if we already had the breakout, but the rest of the chart is coming together. The RSI is currently holding in positive territory. The PMO is very close to a Crossover BUY Signal. Stochastics are oscillating in positive territory and are rising. I like that I can set a thin stop of 4.6% or $90.75.
The weekly chart is healthy enough, but the weekly PMO looks a little suspect right now so keep this in the short-term timeframe. Other than the weak PMO, the rest of the chart is bullish. The weekly RSI is positive and the SCTR is almost in the hot zone. Should it manage a breakout, we could see upside potential at over 18%.
abrdn Physical Palladium Shares ETF (PALL)
EARNINGS: N/A
PALL tracks the palladium spot price, less trust expenses. Click HERE for more information.
Predefined Scans Triggered: None.
PALL is down -0.30% in after hours trading. It is rallying off strong support currently, but this one is very beat down. We could have another UNG situation with it staying in this trading range for some time. The good news is that it is not at the top of the range yet and we have a bullish falling wedge. Price is about to breakout as the pattern suggests. The RSI has moved back into positive territory and the PMO has given us a Crossover BUY Signal. Stochastics are rising vertically into positive territory. I've set the stop below support at 6% or $108.44.
The weekly chart is not impressive and tells us to be cautious or at least understand this is a risky play. The weekly RSI is deeply negative and the SCTR is in the basement. The weekly PMO did just give us a Crossover BUY Signal, but it is very flat and unresponsive so far. I see big things for Palladium if it breaks out. The question will be how long before it breaks out?
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 40% 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
(c) Copyright 2023 DecisionPoint.com
Watch the latest episode of DecisionPoint Trading Room with Carl & Erin Swenlin on Mondays 3:00p EST or on the DecisionPoint playlist on the StockCharts TV YouTube channel here!
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