I am still looking for the Energy trade to come to fruition. And to that end I included yet another choice for you in the Energy sector for ETF Day.
I wasn't particularly impressed with the selections today so I have no runner-ups, but I will tell you that the GOOGL 2x ETF (GGLL) and AAPL 2x ETF (AAPU) both showed up in today's scans and both look pretty good. I'm just a bit concerned about the market topping right now so I decided against leveraged ETFs. Also it seemed wrong to include single stock ETFs on ETF Day. Today should give exposure to more than just one company.
I do have a "Boom or Bust" ETF for you today. Marijuana ETFs are beginning to reverse. It wouldn't take much to get them up there quickly for a good 'boom', but it is always a high risk play in this area, hence the possibility of a 'bust'.
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": DBJP, EMLP and MSOS.
RECORDING & DOWNLOAD LINK (6/21/2024):
Topic: DecisionPoint Diamond Mine (6/21/2024) LIVE Trading Room
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When: Jun 28, 2024 09:00 AM Pacific Time (US and Canada)
Topic: DecisionPoint Diamond Mine (6/28/2024) LIVE Trading Room
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Below is the latest free DecisionPoint Trading Room recording from 6/24. You'll find these recordings posted on Mondays to our DP YouTube Channel. Be sure and subscribe HERE.
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.
Deutsche X-trackers MSCI Japan Hedged Equity ETF (DBJP)
EARNINGS: N/A
DBJP tracks a market-cap-weighted index of Japanese stocks. The fund is hedged against Japanese yen (JPY) currency fluctuations. Click HERE for more information.
Predefined Scans Triggered: None.
DBJP is down -3.32% in after hours trading so I'm already having second thoughts about this ETF, but as I noted earlier, there weren't a whole lot of choices today. I do like today's breakout which suggested to me we would see follow through. We still could. The RSI is positive and not overbought and we do have a new PMO Crossover BUY Signal occurring above the zero line. The chart looks awfully good for this big after hours decline. Stochastics are rising and this ETF has shown very good relative strength so far. I've set the stop below the April low at 7.7% or $68.86.
The weekly chart isn't that encouraging on this breakout so keep this in the short-term horizon. The weekly RSI is overbought and the weekly PMO is declining in a negative divergence with price. On the bright side, the StockCharts Technical Rank (SCTR) is at the top of the hot zone, so the picture could improve. Consider a 17% upside target to about $87.29.
*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.
First Trust North American Energy Infrastructure Fund (EMLP)
EARNINGS: N/A
EMLP is an actively managed fund that invests in North American energy infrastructure MLPs and LLCs. Click HERE for more information.
Predefined Scans Triggered: P&F Ascending Triple Top Breakout and P&F Double Top Breakout.
EMLP is up +0.42% in after hours trading. It is currently in a trading range not a declining trend channel as most of Energy is right now. It has pulled back some of the rally and that has decelerated the PMO, but I am still positive on Energy and look for good things out of this ETF soon. The RSI is in positive territory and not overbought. The PMO is above the zero line as it heads toward a Crossover BUY Signal. Stochastics are rising strongly and are above 80. We can see some outperformance coming in on relative strength. The stop is set at the April low at 7.9% or $28.19.
The weekly chart is already improving. I see two small bull flags right now coming out of the rally that started in early 2024. The weekly RSI is positive and not overbought. The weekly PMO is turning back up and the SCTR is in the hot zone above 70. Consider a 17% upside target to around $35.81.
AdvisorShares Pure US Cannabis ETF (MSOS)
EARNINGS: N/A
MSOS is an actively managed narrow portfolio of US stocks or swap contracts related to the domestic cannabis and hemp industry. Click HERE for more information.
Predefined Scans Triggered: P&F Double Bottom Breakdown.
MSOS is down -0.12% in after hours trading. I like this reversal coming just below support. It is a trading range, but it is a long way to the top of that range and that could be very lucrative. It has a nice "V" bottom shape as well. The RSI is not yet positive, but it is therefore not overbought. I like the new PMO Crossover BUY Signal. We see that the OBV is rising to confirm the rally. Stochastics are almost above 80. The ETF is also outperforming the market right now. This is a low-priced ETF so position size wisely. The stop is set beneath the March low at 7.8% or $7.21.
This is definitely a short-term trade given the negative weekly chart. The weekly RSI is negative and the weekly PMO is falling. The SCTR is rising, but isn't very close to the hot zone yet. I'm looking for a move to test the top of the trading range. That would be a real 'boom'.
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 "Under the Hood" 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 45% 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.
Helpful DecisionPoint Links:
Price Momentum Oscillator (PMO)
Swenlin Trading Oscillators (STO-B and STO-V)
For more links, go to DecisionPoint.com