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Long-Short Idea List: 05-30-19

Written by Lance Roberts | May 29, 2019

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

AMD – Advanced Micro Devices

  • AMD just bounced off of support and the trade setup is decent with a very tight stop.
  • Buy at current levels with an initial target of $32.
  • Stop level is $26

ALE – Allete

  • We have previously recommended ALE for a long position.
  • Currently ALE is overbought but a breakout to new highs would likely see the stock climb higher.
  • If you are currently long ALE, hold with a stop at $78.
  • If not, look to buy ALE on a breakout to new highs at $83.
  • Stop-loss on new positions is currently $81

INTC – Intel Corp.

  • This is a speculative trade. INTC has been “beaten down” over the last couple of months and is very oversold.
  • The trade setup is tight as INTC is sitting on strong support currently.
  • Buy at current levels with a trade target of $48
  • Stop-loss is $43

TTWO – Take-Two Interactive

  • We previously recommended shorting TTWO which worked out well.
  • However, there is now an opportunity to play the other side of the trade.
  • TTWO has registered a buy signal and has broken above resistance at the 200-dma..
  • Buy at current levels with a target of $120-125
  • Stop Loss is set tight at $100

WMT – Walmart

  • WMT has rallied nicely from the December lows and earnings have looked good.
  • Now back on a buy signal, a break above overhead resistance will provide a tradeable entry point.
  • Buy above $103.50
  • Stop loss is set at $100

SHORT CANDIDATES

GOOG – Alphabet Inc.

  • The long-position we recommended previously failed to mature. GOOG is now setting up for a potential short-side trade.
  • Look for a break below the 200-dma to take on a short-position.
  • Potential target is $1000 (This would coincide with a larger market correction as well.)
  • Stop-loss is set at $1130

GIS – General Mills

  • The trade-war, which restarts June 1st, is starting to weigh on tariff sensitive sectors of the market.
  • GIS broke through support and has not registered a sell-signal just yet.
  • Short 1/2 position at current levels with an initial target of $45
  • Keep the stop loss tight for now at $50

HPE – Hewlett Packard

  • HPE has broken important support levels and has registered a sell signal while not oversold as of yet.
  • Short HPE at current levels with an initial target of $12.50
  • Stop loss is tight at $15

USB – US Bancorp

  • USB is flirting with important support within a long-term consolidation process.
  • Look for a break below $50 to establish the short position.
  • Stop is set at $51
  • Target for the trade is $47

VIAB – Viacom Inc.

  • VIAB recently broke support and is triggering a short-term sell signal.
  • Short at current levels with a initial target of $25
  • Set stops at $29

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Lance Roberts is a Chief Portfolio Strategist/Economist for RIA Advisors. He is also the host of “The Lance Roberts Podcast” and Chief Editor of the “Real Investment Advice” website and author of “Real Investment Daily” blog and “Real Investment Report“. Follow Lance on Facebook, Twitter, Linked-In and YouTube

2019/05/29
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