Thank you for sending in a nice collection of requests today. I liked all of the charts with the exception of one and it really wasn't that bad.
The market is going to chop and churn for a bit in my opinion so the buying frenzy is over for the moment. I do believe we'll see further upside, but the rally has to be digested. I don't see enough danger to sell positions in my portfolio, but I will be keeping close tabs on them to make sure the charts don't break down overall. Some weakness should be expected.
Tomorrow is the Diamond Mine trading room. Be sure and register! Links for both the recordings and registration are below. Remember, if you cannot attend the Diamond Mine, you can still download the video for review later.
Good Luck & Good Trading,
Today's "Diamonds in the Rough": ISRG, QDEL and T.
Other requests: WPM, HCC, VZ, CAMT (weak), CLS and SYK.
RECORDING LINK (11/10/2023):
Topic: DecisionPoint Diamond Mine (11/10/2023) LIVE Trading Room
REGISTRATION for 11/17/2023:
When: Nov 17, 2023 09:00 AM Pacific Time (US and Canada)
Topic: DecisionPoint Diamond Mine (11/17/2023) 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 11/13:
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.
Intuitive Surgical, Inc. (ISRG)
EARNINGS: 01/23/2024 (AMC)
Intuitive Surgical, Inc. engages in the provision of robotic-assisted surgical solutions and invasive care through a comprehensive ecosystem of products and services. Its products include Da Vinci Surgical and Ion Endoluminal systems. The company was founded by Frederic H. Moll, John Gordon Freund, and Robert G. Younge in November 1995 and is headquartered in Sunnyvale, CA.
Predefined Scans Triggered: Moved Above Upper Keltner Channel, Stocks in a New Uptrend (Aroon), Moved Above Ichimoku Cloud, Moved Above Upper Price Channel, P&F Double Top Breakout and P&F Bearish Signal Reversal.
ISRG is up +0.02% in after hours trading. Price broke from a messy bullish reverse head and shoulders pattern. It has nearly reached its minimum upside target, but keyword is "minimum". I think it has further to go. The RSI is positive and rising, the PMO is just about in positive territory as it rises on a Crossover BUY Signal. Stochastics are above 80. Relative strength is improving of late for the group and the stock. I've set the stop beneath support at 7.2% or $282.06.
The weekly chart is very favorable. Price has broken from a declining trend and is back above resistance. Price now sits on support at the late 2022 top. The weekly RSI just moved into positive territory and the weekly PMO is turning up. It has been a hot rally so I wouldn't be surprised to see a bit of sideways movement across support. The StockCharts Technical Rank (SCTR) isn't in the hot zone* above 70, but it is improving quickly suggesting this could be considered in the intermediate-term timeframe.
*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.
Quidel Corp. (QDEL)
EARNINGS: 02/14/2024 (AMC)
QuidelOrtho Corp. operates as a vitro diagnostics company. It is focused on developing and manufacturing diagnostic products. The company was founded on May 27, 2022 and is headquartered in San Diego, CA.
Predefined Scans Triggered: Parabolic SAR Buy Signals, P&F Double Top Breakout and P&F Bearish Signal Reversal.
QDEL is unchanged in after hours trading. This is a reversal candidate and therefore carries some added risk. There is a bullish double bottom that was confirmed with today's breakout above the confirmation line. The minimum upside target would take it above overhead resistance to about 72.50. It could move higher as the PMO is now rising on an oversold Crossover BUY Signal. The RSI just hit positive territory. Stochastics are rising strongly and should reach above 80 soon. The group is not performing well at all and that is putting a damper on QDEL, but it is managing to outperform the SPY. I've set the stop at 7.5% or $60.65.
Price dropped below prior support, but it is now reversing off the next line of support before actually touching it. That is a bullish condition. The rest of the chart isn't good so keep this in the short-term timeframe. The weekly RSI is negative and while the weekly PMO has decelerated, it is still in decline. The SCTR is not at all close to the hot zone. Should it be able to breakout, there is plenty of upside potential. It's about 17% away from the next level of support.
AT&T, Inc. (T)
EARNINGS: 01/24/2024 (BMO)
AT&T, Inc. is a holding company, which engages in the provision of telecommunications media and technology service. It operates through the Communications and Latin America segments. The Communications segment offers services to businesses and consumers located in the U.S., or in U.S. territories, and businesses globally. The Latin America segment is involved in entertainment and wireless services outside of the U.S. The company was founded in 1983 and is headquartered in Dallas, TX.
Predefined Scans Triggered: None.
T is down -0.19% in after hours trading. I didn't annotate it, but we have a nice saucer-shaped basing pattern that takes up all of the chart. It's slowly making its way higher. We are vulnerable to the formation of a handle to the cup shaped bottom, but indicators suggest we have some time before that happens. The rally out of the July low has been steady with healthy pullbacks along the way. I like that price curled back up on support. The RSI is positive and not at all overbought. The PMO has surged above the signal line on a Crossover BUY Signal. Stochastics reversed higher in positive territory. If I had a complaint it would be that relative strength is flat against the SPY. I prefer to see outperformance. The stop is set beneath the late October low at 7.9% or $14.62.
The weekly chart suggests to me we could consider this for the intermediate term. The only issue is the declining SCTR below the hot zone. However, given the bullish configuration of the weekly PMO and weekly RSI, I do see intermediate-term merit. The steady rally on the daily chart brought price above overhead resistance and into the last trading range. I am looking for price to make its way back to the top of that range.
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 70% 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.
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