It is ETF Day! I was pleased with the scan results and was able to find you three ETFs for your consideration and two runner-up selections. The market seems healthy and continues to click higher and that is offering more results for the scans.
I didn't catch any major theme in the scan results, but many large-cap index type of funds did appear. It tells me that the market is still healthy. Not surprisingly, there were no inverse ETFs. I will say that on one of my scans that I don't run frequently did turn up Healthcare. I'm still ambivalent about this area of the market, but thought I would alert you if you want to take the risk.
Tomorrow is Reader Request Day. I have a few already but would like to have far more so please send in your choices by about Noon PT tomorrow. I love seeing what is on your radar.
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": AIPI, DYNF and SRVR.
Runner-ups: CIBR and FTLS.
SCHEDULE FOR THIS WEEK: There will be no Diamond Mine this week due to Thanksgiving. I will do four "Diamonds in the Rough" on Monday and three ETF picks on Tuesday with three Reader Requests falling on Wednesday this week. The DP Diamonds Recap will be published on Friday.
Diamond Mine Trading Room:
RECORDING & DOWNLOAD LINK (11/22/2024):
Topic: DecisionPoint Diamond Mine (11/22/2024) LIVE Trading Room
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When: December 6, 2024 09:00 AM Pacific Time (US and Canada)
Topic: DecisionPoint Diamond Mine LIVE Trading Room
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Below is the latest free DecisionPoint Trading Room recording from 11/25. 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.
ETF Opportunities Trust - REX AI Equity Premium Income ETF (AIPI)
EARNINGS: N/A
AIPI is actively managed, investing in leading Artificial Intelligence (AI) companies selected from the holdings of the BITA AI Leaders Select Index. The fund seeks to generate income by writing covered call options on its holdings, aiming for capital growth and current income, while maintaining the flexibility to adapt based on market conditions. Click HERE for more information.
Predefined Scans Triggered: None.
AIPI is up +0.06% in after hours trading. I liked this one primarily because it had broken out above the prior top while many of the other ETFs hadn't broken out yet. This is on the lower volume side but it does fit closely to my 100,000 50-day MA threshold. The RSI is positive and not overbought. The PMO is on a new Crossover BUY Signal. Stochastics are holding above 80 and we can see that relative strength has been excellent since the August low. This is a rather new ETF so we don't have complete PMO data yet. The stop is set beneath support at 7.9% or $46.74.
There isn't much to see on the weekly chart except for the near vertical rally. This does worry me somewhat as it is quite vertical and could see a corrective move to soften the angle of ascent so keep this short-term for now. The weekly RSI is positive. There is no weekly PMO yet. The StockCharts Technical Rank (SCTR) isn't in the hot zone* but it is getting close. Consider a 17% upside target to about $59.38.
*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.
BlackRock U.S. Equity Factor Rotation ETF (DYNF)
EARNINGS: N/A
DYNF is an actively-managed fund of large- and mid-cap US stocks that uses five equity style factors. Click HERE for more information.
Predefined Scans Triggered: Moved Above Upper Price Channel, P&F Ascending Triple Top Breakout, P&F Double Top Breakout and New 52-week Highs.
DYNF is up +0.04% in after hours trading. This is another one with a current breakout. We have to be on board with mega-caps though as you can see from the holdings. Small-caps are doing quite well. It may be time for the large-caps to catch up. This breakout is certainly encouraging. The RSI is positive and not yet overbought. The PMO has whipsawed back into a Crossover BUY Signal. Stochastics are above 80 and you can see that this ETF has been outperforming the SPY since August/September. The stop is placed beneath support at 7.7% or $48.55.
The weekly chart is very favorable with a strong rising trend that isn't parabolic or vertical. The weekly RSI is positive and not overbought and the weekly PMO is on a Crossover BUY Signal well above the zero line. It is also flat above the zero line implying pure strength in the move. The SCTR is also in the hot zone. Consider a 17% upside target to about $61.55.
Pacer Benchmark Data & Infrastructure Real Estate SCTR ETF (SRVR)
EARNINGS: N/A
SRVR tracks a market cap-weighted index of real estate companies from developed markets that are related to data and infrastructure. Click HERE for more information.
Predefined Scans Triggered: Hollow Red Candles and P&F Double Top Breakout.
SRVR is down -2.27% in after hours trading. I'm only just seeing the negative trading after hours that could point to problems already for this selection, but I see it as an opportunity to get in at a better price point. I like the Real Estate sector right now and am looking for higher prices there. This ETF should take advantage. Today formed a bullish hollow red candlestick suggesting we should see a rally tomorrow. We'll see. The RSI is positive and not overbought. We have a brand new PMO Crossover BUY Signal. Stochastics have pushed past 80 suggesting internal strength. I also see that this ETF has been outperforming the SPY. The stop is set beneath the 200-day EMA at 7.1% or $29.50.
The weekly chart is improving. We have a bullish flag formation. You can barely see it, but price is breaking away from the flag with a gap up. The weekly RSI is positive and not at all overbought. The weekly PMO is turning back up above the signal line well above the zero line. The SCTR is very near the hot zone. The minimum upside target of the flag would take price above the 2022 high. Not so sure it will make it all the way there, but certainly there is good upside available.
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 60% 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