The market is acting like it wants to rally, but I have to say, my Diamond Dog Scan that finds shorts was very plentiful today so I did include one short.
The two themes that were prevalent in the scans were Consumer Staples and Utilities. I think it best to concentrate on the more defensive areas of the market and the scans seem to think so too. I have one Utility and two Food Retailers.
We could be getting ready to see a bounce in the beatdown Technology stocks, but I'm not confident enough in the rally to take a chance there right now. I may change my mind tomorrow, but for now I'm staying cautious.
Good Luck & Good Trading,
Erin
Today's "Diamonds in the Rough": CC (Short), CMS, SPTN and UNFI.
Runner-ups: AOSL (Short), TFIN (Short), SCSC (Short), EXC and EVRG.
Diamond Mine Trading Room:
RECORDING & DOWNLOAD LINK (3/28/2025):
Topic: DecisionPoint Diamond Mine (3/28/2025) LIVE Trading Room
Recording & Download Link
Passcode: March#28
REGISTRATION for 4/4/2025:
When: April 4, 2025 09:00 AM Pacific Time (US and Canada)
Topic: DecisionPoint Diamond Mine LIVE Trading Room
Register in advance for this webinar HERE
After registering, you will receive a confirmation email containing information about joining the webinar.
Below is the latest free DecisionPoint Trading Room recording from 3/31. 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.
Chemours Co. (CC) - SHORT
EARNINGS: 2025-04-29 (BMO)
The Chemours Co. is a holding company, which engages in the provision of performance chemicals. The firm delivers solutions, which include a range of industrial and chemical products for markets including coatings, plastics, refrigeration and air conditioning, transportation, semiconductors and consumer electronics, and general industrial. It operates through the following segments: Titanium Technologies, Thermal and Specialized Solutions, Advanced Performance Materials, and Other. The Titanium Technologies segment is involved in the manufacture of titanium dioxide pigment. The Thermal and Specialized Solutions segment offers refrigerants, propellants, blowing agents, and specialty solvents. The Advanced Performance Materials segment produces polymers and advanced materials that deliver attributes, including chemical inertness, thermal stability, low friction, weather and corrosion resistance, extreme temperature stability, and di-electric properties. The Other segment consists of performance chemicals and intermediates business. The company was founded on February 18, 2014 and is headquartered in Wilmington, DE.
Predefined Scans Triggered: P&F Double Bottom Breakdown, P&F Descending Triple Bottom Breakdown, Stocks in a New Downtrend (Aroon), Moved Below Lower Bollinger Band, Moved Below Lower Price Channel and New 52-week Lows.
CC is up +1.85% in after hours trading so you should get a better entry on this short. It isn't surprising to see the after hours rebound given today's 4%+ decline. I chose this because it has lost near-term support on today's decline. The indicators are great for a short. The RSI is negative and falling. The PMO has topped well below the zero line and is headed toward a Crossover SELL Signal. Stochastics have now dropped below 20 indicating internal weakness. Relative strength for the group is rising which nearly prevented me from picking it, but ultimately the other indicators sold me. It is underperforming both the group and the SPY. The upside stop is set at 7.8% or $13.97.
We have large bearish rounded top on the weekly chart with a recent breakdown to new 52-week lows. The weekly RSI is not oversold yet. The weekly PMO is in decline below the zero line on a Crossover SELL Signal. The StockCharts Technical Rank (SCTR) is in the basement, far away from the hot zone*. I think there is plenty of downside potential here given the lack of support levels.
*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.
CMS Energy Corp. (CMS)
EARNINGS: 2025-05-01 (BMO)
CMS Energy Corp. engages in the provision of electric and natural gas activities. It operates through the following business segments: Electric Utility, Gas Utility, and NorthStar Clean Energy. The Electric Utility segment focuses on generation, purchase, distribution, and sale of electricity. The Gas Utility segment includes purchase, transmission, storage, distribution, and sale of natural gas. The NorthStar Clean Energy segment is involved in domestic independent power production including the development and operation of renewable generation and the marketing of independent power production. The company was founded in 1987 and is headquartered in Jackson, MI.
Predefined Scans Triggered: None.
CMS is unchanged in after hours trading. I like the breakout after price coiled in a trading range. It is reminiscent of a flag formation. The RSI is positive and not overbought yet. The PMO is about to give us a Crossover BUY Signal well above the zero line. Stochastics are above 80 and relative strength for the group is gaining. It is really outperforming the SPY right now. The stop doesn't have to be too deep which I like. I set it below support at 6% or $70.63.
There's only one problem on the weekly chart and that is an overbought weekly RSI. I'll accept it as we can see it has been able to maintain overbought conditions in the past for more than a week. The weekly PMO is rising on a Crossover BUY Signal well above the zero line. The SCTR is firmly in the hot zone above 70. We can also see the OBV rising with price in confirmation of the rally. Consider a 17% upside target to about $87.91.
SpartanNash Company (SPTN)
EARNINGS: 2025-05-29 (BMO)
SpartanNash Co. engages in the distribution of grocery products to military commissaries in the U.S. It operates through the following segments: Military, Food Distribution and Retail. The Military segment sells and distributes grocery products primarily to U.S. military commissaries and exchanges. The Food Distribution segment distributes groceries to independent and corporate owned grocery retailers using multi-platform sales approach. The Retail segment operates retail supermarkets in the Midwest, which operate under banners of Family Fare Supermarkets, No Frills, Bag 'N Save, Family Fresh Markets, D&W Fresh Markets, Sun Mart, and Econo Foods. The company was founded in 1917 and is headquartered in Grand Rapids, MI.
Predefined Scans Triggered: Moved Above Upper Bollinger Band, Stocks in a New Uptrend (Aroon), Moved Above Upper Price Channel and P&F Double Top Breakout.
SPTN is unchanged in after hours trading. This one caught my eye due to the symmetrical triangle breakout. A symmetrical triangle is a continuation pattern so we expect a breakout and followthrough. The RSI is positive and not overbought. The PMO is flat above the zero line indicating pure strength. It is also on a new PMO Crossover BUY Signal. The OBV is rising with price. Stochastics are above 80 and rising. The group is really outperforming right now so it was an easy choice in that regard. SPTN is clearly outperforming the group and the SPY. I've set the stop below the most recent low at 7.5% or $19.14.
I was a little disappointed to see it was in a trading range. Even if it got to the top of the range it would be an almost 12% gain which is nothing to sneeze at, but I think we'll get a breakout this time given possible market weakness. The weekly RSI is positive and not overbought. The weekly PMO is rising above the zero line now on a Crossover BUY Signal. The SCTR has just recently entered the hot zone above 70.
United Natural Foods, Inc. (UNFI)
EARNINGS: 2025-06-11 (BMO)
United Natural Foods, Inc. engages in the distribution of natural, organic, and specialty foods and non-food products. It offers food and non-food, frozen, perishables, bulk, body care products, and supplements. It operates through the following segments: Wholesale, Retail, and Other. The Wholesale segment refers to the national distribution of natural, organic, specialty, produce, and conventional grocery and non-food products, and providing retail services in the United States and Canada. The Retail segment derives revenues from the sale of groceries and other products at retail locations operated by company. The company was founded by Michael S. Funk and Norman A. Cloutier in July 1976 and is headquartered in Providence, RI.
Predefined Scans Triggered: Improving Chaikin Money Flow.
UNFI is unchanged in after hours trading. We have a small rally. This is an early pick as the rally hasn't really gotten going yet. I'd like to see price get over the 50-day EMA soon. The RSI is still negative, but is very close to positive territory so I'll take it. The PMO is on a new Crossover BUY Signal. It is running flat beneath the zero line so it is currently only indicating weakness, but the BUY Signal is promising. Stochastics are above 80 and as noted above the industry group is on fire. UNFI is slowly outperforming the group and the SPY. It's early on this one, but it does hold some promise as far as upside targets as you'll see on the monthly chart. The stop is set below the prior low and as close as possible to support at 8% or $25.42.
The rally failed, but price found support and is reversing. It looks very much like a bull flag. We have a positive weekly RSI that is not overbought. The weekly PMO is not good right now but it makes sense given the deep decline it recently experienced. It will take some time to turn it around. The SCTR is in the hot zone and that is very bullish.
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 15% 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 2025 DecisionPoint.com
Watch the latest episode of DecisionPoint Trading Room with Carl Swenlin & Erin Swenlin Mondays on the DecisionPoint 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