Sunday, October 28, 2018

Market Has Bounce Potential (Weekend Newsletter)

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Weekend Newsletter for
October 28, 2018


Table Of Contents

1) MARKET SUMMARY from THE DAILY

2) STOCK SPLIT REPORT

3) IH ALERTS

4) SUCCESS TRADING GROUP

5) COVERED CALL SERVICE

      

Jon Johnson
1) MARKET SUMMARY
         > >From "The Daily" by Jon Johnson at InvestmentHouse.com


Friday did little to alter the back and forth volatility.

- Earnings disappointments send stocks lower Friday, then a recovery of sorts.
- Indices hold at the 78% Fibonacci retracement in ABCD patterns. There is bounce potential . . . as if that is a new story . . .
- GDP solid, consumers solid, business investment not.
- Fed remains resolute that all is well even as the top line earnings misses balloon.
- Some good patterns, some 'name's with interesting setups, but still no follow through session, not even a real reversal session yet.
- More earnings, tons of economic data this week.
- Even on a bounce of the old leaders or a breakout from good patterns, it does not appear time to load up the brokerage accounts.


Market Summary (continued)
Friday did little to alter the back and forth volatility as AMZN and GOOG earnings helped the market sell off to new lows on this leg lower. Bids returned, however, and pushed the indices back above the Wednesday lows. That turned truly impressive losses to just 1% to 2% declines on the indices. NASDAQ for instance closed lower 151 points but was off 260+ on the low. So there was some recovery.

SP500 -46.88, -1.73%
NASDAQ -151.13, -2.07%
DJ30 -296.24, -1.19%
SP400 -1.06%
RUTX -1.10%
SOX -1.72%
NASDAQ 100 -2.34%

VOLUME: NYSE +5%, NASDAQ +7%. Volume up on a selloff but also on a recovery off the lows to hold the prior low. Decent enough.

ADVANCE/DECLINE: NYSE -2.6:1, NASDAQ -2.2:1. Was a lot worse before the recovery off the low.

NEW LOWS: NYSE 528, NASDAQ 446. That lower low pushed up the new lows once more.

There was also, despite the up and down from session to session, a steady trend lower. Perhaps the selloff was enough to put in a bounce. Perhaps it was just short covering to end a really weak week. There is so much bottom calling and bottom wishing, at this juncture it is hard to listen to the financial stations and keep a clear view.

That is what makes a follow through to any buying so important. The day to day back and forth action shows the need to have a good day of buying on a reversal, then after that initial move rests, see a return of upside with strength again. That shows that after that initial move buyers want to pick up more stocks. These are usually longer term holders versus the initial short covering moves.

Read "The Daily" Entire Weekend Summary
Watch Market Overview Video
Watch Technical Summary Video
Watch Next Session Video


Here's a trade from "The Daily" and insights into our trading strategy:


Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.


ACAD (Acadia Pharmaceuticals--$21.74; +0.46; optionable): Biotech
Company Profile
EARNINGS: 11/06/2018
STATUS: ACAD trended lower from October 2017. It sold sharply in April but started to bottom that same month with a double bottom of sorts. As it sold that month, MACD started to rise. ACAD did not follow immediately, however, matching those lows in June, but then fading into August and September with something of a double bottom. MACD continued its improvement, and in the last half of September ACAD shot higher. It cleared the 200 day SMA late September and has spent the time since working laterally along the 200 day. Nice consolidation of the move with ACAD starting to bounce Thursday and Friday. We are looking to move in as the stock continues upside, preferably on some volume.
CHART VIDEO
Volume: 1.736M Avg Volume: 3.171M
BUY POINT: $22.25 Volume=4.6M Target=$26.93 Stop=$20.69
POSITION: ACAD JAN 18 2019 22.00 C - (55 delta) &/or Stock

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2) STOCK SPLIT REPORT

Playing stock splits can be very profitable, but it takes know-how. Our stock split service focuses on three main types of plays:

1) pre-announcement (where we forecast an upcoming split prior to the company making the announcement); 2) pre-split (these plays are made in the days leading up to the actual split day); and 3) post-split plays (plays made after the actual stock split where the stock is showing continued or renewed strength).

Listen to Stock Split Report Editor Jon Johnson's
stock split interview on CNBC-TV [ View Here ]



Here's a leader play and our current analysis.

Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
FATE (Fate Therapeutics--$13.43; -0.08; optionable): Biotech, drugs
Company Profile
EARNINGS: 11/07/2018
STATUS: FATE is testing the 200 day SMA after breaking higher in the second half of September from a 7 month trading range. Nice rally to 17 to end September. October was not as upside kind and FATE faded back to the 50 day MA midmonth, then sold last week to the 200 day SMA. It held and Thursday bounced on excellent volume. Friday it paused with what is likely a continuation doji. Looks as if FATE has made it through the selling more or less testing its breakout. With the good bounce on volume, we want to move in as FATE continues the upside move with a target near that recent high. Seems logical, yeah verily fate, that it should make that height.
CHART VIDEO
Volume: 563.567K Avg Volume: 782.433K
BUY POINT: $13.82 Volume=1M Target=$16.72 Stop=$12.85
POSITION: FATE FEB 15 2019 12.50 C - (66 delta) &/or Stock

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Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
3) IH ALERTS

FOSL (Fossil--$21.16; -0.26; optionable): Retail stores, watches and accessories
Company Profile
EARNINGS: 11/06/2018
STATUS: After reaching a high in June, FOSL has trended steadily lower in a rather orderly pullback below the 50 day MA. It finally sold to the 200 day SMA last week, worked laterally, then popped upside Thursday. Friday showed a doji similar to FATE, and it looks as if that is a continuation doji, i.e. the stock will continue higher off this move. We think the pinch between the 200 day on the low and the 50 day MA on the high will yield a breakout move from the current 4.5 month downtrend. We want to play a strong breakout move for a run at the 28 level where the early August peak resides.
CHART VIDEO
Volume: 1.75M Avg Volume: 1.377M
BUY POINT: $22.54 Volume=2M Target=$27.96 Stop=$20.71
POSITION: FOSL JAN 18 2019 22.00 C - (51 delta) &/or Stock

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Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
4) SUCCESS TRADING GROUP
--by the MarketFN STG Team

WMT (Walmart, Inc.)
Company Profile
Our Success Trading Group members scored another winning trade this week when we closed out a position in Walmart, Inc. (Ticker: WMT). We are watching several stocks and are looking forward to trading next week.

Our Success Trading Group closed
7 years with 0 losses on our Main Trade Table. In fact, we closed 100% winning trades for the calendar years 2016, 2015, 2013, 2012, 2011, 2010 and 2009 (we still have 1 open position from 2017 (all others were winners) and 1 trade that we opened in 2014 was closed as a losing trade). All of these trades are posted on our Main Trade Table for your review during your free membership trial period.

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Chart by StockCharts.com
Please turn on your ability to receive graphics. We are providing you with a detailed chart of this stock. If you are unable to turn on graphics, please CLICK HERE or on the *Read Our Weekend Report Online* link above.
5) COVERED CALL PLAY

PBR - Petroleo Brasileiro S.A. - Petrobras is currently trading at $16.24. The November $16.00 Calls (PBR20181117C00016000) are trading at $1.29. That provides a return of about 7% if PBR is above $16.00 on expiration Friday in November.
Company Profile



Learn more about our Covered Call Tables


PREMIUM SERVICES
IH Alerts: InvestmentHouse.com's Best of The Best Plays!
Stock Split Report: Forbes.com Best of the Web
Covered Calls: Allowed in your IRA - Energize your portfolio!
The Daily: "The Daily" is a must read for all investors!
Success Trading Group: 7 years without a trading loss!
The foregoing is commentary for informational purposes only. All statements and expressions are the opinions of Online Investment Services, LP., or Split Ventures, Ltd. This information is not meant to be a solicitation or recommendation to buy, sell, or hold securities. We are not licensed or registered in the securities industry. The information presented herein and on the related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolios of writers for this issue may, in some instances, include securities mentioned herein and on the related web site. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors. No one associated herewith receives compensation in any manner from any of the companies that are discussed in this newsletter or on the related websites.
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