I'm not surprised that many of the regulars didn't send in requests this week. The scans haven't been producing as many symbols as I'd like so I imagine you are having trouble finding candidates on the long side as well. Please know that you are welcome to send in symbols on the short side too.
Since we didn't have that many requests come in, two of today's symbols are my own, GPRE and NVO. NVO comes from my Surge Scan. Those who are part of the beta test of Scan Alert System may question this given NVO wasn't listed in today's email. The Scan Alert System is limited to scanning the SP1500, Dow 65 and NDX. I can get more results as sometimes I'm scanning a larger universe. I only open up the universe when I am not pleased with the number of results from the Scan Alert System universe.
I have listed a few other stocks that were requested as well as a few results from my scans as "Runners-up".
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": GPRE, NVO, SQSP and UE.
Runners-up: HCC, VNM, CALM, SPG and AMH.
RECORDING LINK (9/1/2023):
Topic: DecisionPoint Diamond Mine (9/1/2023) LIVE Trading Room
Passcode: September#1
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When: Sep 8, 2023 09:00 AM Pacific Time (US and Canada)
Topic: DecisionPoint Diamond Mine (9/8/2023) LIVE Trading Room
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Here is the last recording from 8/28 - No recording on Labor Day:
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.
Green Plains Inc (GPRE)
EARNINGS: 11/02/2023 (BMO)
Green Plains, Inc. engages in the production of fuel-grade ethanol and corn oil, the provision of grain handling, and storage commodity marketing and distribution services. It operates through the following segments: Ethanol Production, Agribusiness and Energy Services, and Partnership. The Ethanol Production segment produces ethanol, distillers' grain, and corn oil at ethanol plants in Indiana, Iowa, Minnesota, Nebraska, Tennessee, and Texas. The Agribusiness and Energy Services segment includes grain procurement and its commodity marketing business, which markets, sells, and distributes ethanol, distillers' grains, and corn oil produced at ethanol plants. The Partnership segment provides fuel storage and transportation services by owning, operating, developing, and acquiring ethanol and fuel storage tanks, terminals, transportation assets, and other related assets and businesses. The company was founded in June 2004 and is headquartered in Omaha, NE.
Predefined Scans Triggered: Elder Bar Turned Green, P&F Bullish Signal Reversal, Bullish MACD Crossovers, Parabolic SAR Buy Signals, Entered Ichimoku Cloud and P&F Double Bottom Breakout.
GPRE is down -2.01% in after hours trading so some profit taking is going on. This was an excellent breakout confirming a bullish falling wedge pattern. The RSI has just moved into positive territory and the PMO is going in for a Crossover BUY Signal. Stochastics are rising and just moved above net neutral (50), landing them in positive territory. The Specialty Chemicals industry group is performing in line with the SPY, but GPRE has started to seriously outperform this week on the rally. Given price has overcome resistance at key moving averages, I would expect to see some followthrough. Upside potential is limited on this trading range stock, but it is still worthwhile. The stop has been set at 7.7% or $30.26.
We can see this is definitely a trading range stock so it is important that we are near the bottom of that range. The weekly RSI has just moved positive and the StockCharts Technical Rank (SCTR) has entered the hot zone* above 70. The weekly PMO only tells us the stock is rangebound. Keep this in the short-term timeframe until the PMO makes up its mind and has an upside crossover. If it can reach its closing all-time high it would be a nearly 30% 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.
Novo Nordisk A S (NVO)
EARNINGS: 11/02/2023 (BMO)
Novo Nordisk A/S is a global healthcare company, which engages in the the discovery, development, manufacturing and marketing of pharmaceutical products. It operates through the Diabetes and Obesity Care, and Biopharm segments. The Diabetes and Obesity Care segment includes insulin, GLP-1 and related delivery systems, oral antidiabetic products (OAD), obesity, and other serious chronic diseases. The Biopharm segment focuses on rare blood disorders, rare endocrine disorders, and hormone replacement therapy. The company was founded by Harald Pedersen and Thorvald Pedersen in 1925 is headquartered in Bagsvrd, Denmark.
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.
NVO is up +0.73% in after hours trading. We will file this one under "winners that keep on winning". The RSI is positive but getting a bit overbought. Based on the RSI position back in March/April, we know that it can stay overbought. The PMO has surged above its signal line. It is overbought at the moment so it may be time for the rising trend to stabilize after the big gap up that pushed the PMO into overbought territory. Stochastics are above 80 and relative strength is positive for the group and NVO. This is a leader within this group. The stop is set a little over halfway into the prior trading range below the 20-day EMA at 6.4% or $182.87.
The weekly PMO is not overbought as the daily PMO is. It is on a Crossover BUY Signal and rising. The weekly RSI is overbought, but as with the daily chart, we can see that it can stay overbought for weeks. The SCTR is at the top of the hot zone. I would consider an upside target of 17% or to $228.59.
Squarespace Inc. (SQSP)
EARNINGS: 11/07/2023 (BMO)
Squarespace, Inc. operates as a digital publishing and e-commerce software platform. The firm serves the bloggers, artists, restaurants, and musicians. The company was founded by Anthony Casalena in 2003 and is headquartered in New York, NY.
Predefined Scans Triggered: Moved Above Upper Bollinger Band and Moved Above Upper Price Channel.
SQSP is up +0.03% in after hours trading. My main concern is whether this one will be stymied at overhead resistance given the strong rally it has already experienced. I think there is still some good upside potential given it should break out of the current trading range. The RSI is positive and not overbought so price could move higher. There is a new PMO Crossover BUY Signal and Stochastics are above 80. Relative strength is rising for the group and SQSP is showing leadership among its brethren and against the SPY. I've set the stop below key moving averages at 6% or $30.45.
I didn't annotate as I just saw it, we have rising bottoms and a flat top on price. That is a bullish ascending triangle pattern that implies we should see a breakout soon. The weekly PMO is decelerating and should rise soon. The weekly RSI is in positive territory and not overbought. The SCTR is sitting in the hot zone. Upside potential should it breakout would be over 30%.
Urban Edge Properties (UE)
EARNINGS: 11/02/2023 (BMO)
Urban Edge Properties is a real estate investment trust, which engages in the acquisition, development, redevelopment, and management of retail real estate. Its portfolio includes shopping centers, malls, and industrial parks. The company was founded on June 18, 2014 and is headquartered in New York, NY.
Predefined Scans Triggered: None.
UE is unchanged in after hours trading. EMAs are configured bullishly with the fastest on top and the slowest on the bottom. This looks like a "V" bottom bullish formation. These patterns suggest a breakout above the left side of the "V". That gives us plenty of upside potential. The RSI is positive and there is a brand new PMO Crossover BUY Signal. Volume is definitely coming back in on this stock which had a horrendous first part of August. Stochastics are above 80. UE is bucking the trend as the industry group itself is suffering against the SPY. With its leadership, it is outperforming both the group and the SPY. The stop is set halfway down prior support and the August low at 6.4% or $15.55.
This one teases that we'll have a long-term breakout given the weekly PMO is surging above the signal line. Additionally, the weekly RSI is positive and the SCTR is in the hot zone. It's been rangebound so I would keep this as a short-term trade rather than intermediate-term investment.
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
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Watch the latest episode of DecisionPoint Trading Room with Carl & Erin Swenlin on Mondays 7:00p 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)
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