Long-Short Idea List: 09-26-19

HOW TO READ THE CHARTS

There are four primary components to each chart:

• The price chart is contained within the shaded area which represents 2-standard deviations above and below the short-term moving average.
• The Over Bought/Over Sold indicator is in orange at the top.
• The Support/Resistance line (green) is the longer-term moving average which also acts as a trailing stop in many cases.
• The Buy / Sell is triggered when the green line is above the red line (Buy) or vice-versa (Sell).

LONG CANDIDATES

AMZN – Amazon.com

• Last week, we stated that “if the market is going to move higher into year-end, then AMZN should lead the way particularly as we head into holiday shopping season.”
• The trade setup didn’t change much this past week, and with AMZN’s sell signal pretty deeply oversold there is a decent entry point.
• Buy at current levels.
• Stop is $1740

AVT – Avnet, Inc.

• AVT is at the top of a very volatile downward trending trading range.
• With the buy signal close to turning up, look for a breakout above $44 for a tradeable opportunity up $48-49.
• Buy a position on a breakout of the downtrend at $44.50-45
• Stop is $42.50

KSS – Kohls Corp.

• KSS has been basing near the lows as of late and the sell signal has gotten deeply oversold.
• Buy at current levels with a very tight stop at $47.50
• If KSS announces improved earnings it could get a decent pop higher.
• Target for trade is $55 initially.

GT – Goodyear Tire & Rubber

• I always try and include one very speculative, “if it works its going to make a lot of money” trade idea.
• GT has a P/E 7x, has earnings and throws off a 4.5% yield. Yet it looks like no one is driving cars anymore.
• The trade set up is very good with limited risk.
• Buy at current levels with an initial rally target of $16.50
• Stop-loss is set at $12.50

GPS – Gap, Inc.

• GPS has been beaten up but we are heading into its best time of year, as the shopping season is getting ready to start.
• Risk/reward is easy for this trade.
• Buy a position in GPS at current levels.
• Target for trade is $23
• Stop loss is set at $16.50

SHORT CANDIDATES

AVY – Avery Dennison Corp.

• Last week, we suggested AVY for a long-trade on a breakout above $117.50.
• That didn’t happen and the “sell signal” is just about to trigger.
• Look to short AVY on a break below the previous stop of $112.50
• Target for trade is initially $100
• Stop-loss is $115

BLL – Ball Corp.

• Quite a while back we suggested a long on BLL corp. It is now time to close that trade out and look at a potential retracement of the extreme extension.
• Sell on a break below $72.50
• Target for trade is $60
• Stop-loss is $75

FB – Facebook, Inc.

• Last week, we discussed shorting FB which had been consolidating in a tightening pattern over the last couple of months.
• With a “sell signal” now triggered at a fairly high level, downside risk remains decent.
• Sell short FB on a break below the trendline at $182.50
• Target for trade is $160
• Stop-loss is set to $185

INCY – Incyte Corp.

• When we initially discussed INCY we suggested that it could break either way out of the very tight consolidation it had been building.
• It broke to the downside and triggered the “Sell signal.”
• Short INCY on any bounce that fails to get above $80.
• Stop loss is $82.50 after entry.
• Target for trade is $60

HLT – Hilton Worldwide Holdings.

• HLT has also recently registered a “sell signal” and is trading at fairly overbought levels.
• Sell Short HLT on a break below $90
• Target for trade is $70
• Stop-loss after shorting the position is set at $92.50