Swell Building Up in Energy / BUY Chesapeake [CHK] for Squeeze

Currently I’m searching for an entry point on a medium term trade in energy [XLE].  The trend is UP, so let’s ride along.

The following are the top energy stocks versus the bottom energy stocks trading on the spider in a 3-month.  Try to view the sector as a continuous flow of water, with the entire sector rising.  You’ll get a nice “bell-curve” if you plot this on a chart.

 

3m-xle-spdr-losers3m-xle-spdr

A closer look though reveals that over a shorter period we see spikes in some of the underperforming stocks, especially CHK

chk-xle

CHK trades within a 5-8 channel after breaking its $4 floor.  Naturally profits were taken in May after a major run, but trying to observe the trader’s psychology, I feel there’s a little sense of anxiety for traders to hold the stock long which is usually a good sign to buy the dips.  Furthermore, the shorting on this stock is quite high which I assume is the cause for the stock to rise from $5 to its peak at $8  from Aug-Sep.  Next squeeze is building up.

chk-squeeze

Looking to get in long between the 5.50 – 5:70 range or cheaper.

 

DRYS – A Lesson On Market Players

drys

DRYS is a nice chart that shows you an extreme example of the “psychology” behind trades.

ACT I – The short.  Sure, DRYS trades at -1000 EPS (didn’t even know that was possible, not really sure what that even means!)

ACT II – The squeeze.  The bear’s tears float this stock up fast.

ACT III –  The dump.  Profit taking drives this stock down 85% in a day.

If you traded this stock and profited, good for you.  It’s a little too much for my taste, but at least I can watch from the side and remind myself that this market is indeed controlled by bigger powers.

-Gio-

BUY Square, or be Square [SQ]

…yeah, I don’t know what that means.  Anyway, SQ is bullish after finding support over the past two months.  Nice support building at the 50 MA, and long support (sell stop) at the 200 MA.  Volume picking up, so I’m assuming larger investors are bullish as well.

sq-11-14-2016

Why the recent rise?  Square gets upgraded on pursuit to offer financing products to small to mid size businesses, which makes perfect sense.   Square and Twitter are household names.  We like to own stocks that people know.   Ride to $15!

dsc_7304-pano-editwm

NVDA Beats! UWTI Short -8% move

Look guys, video games is basically legalized drugs.  And NVDA is its dealer.   Absolutely smashed Q3, and I expect their new graphics card products to do well in Q2 of 2017, when they release their new products at their annual convention.  As longs as NVDA continues to win the GPU war, investors will keep this stock moving.

Meanwhile, keep an eye on ATVI, which found support at its 200-day moving average.  ATVI reports in February 2017, and its taken a quick reversal in the past month.  Though not a semiconductor stock, they are somewhat related, so let’s ride this ahead of their earnings, buying every dip as long as the 200 MA holds.

atvinvda-beats-11-12-16

 

Have a good weekend!

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