Similiar to VCR, I was wrong 3 times recently on the VOX add's however as of late the add up vs low's has paid off so far and now we are seeing $87 becoming the next level, now telecom is still no where near out of the woods as it is still in this major downtrend. For now I will add above $87 and will look to also be adding to VZ above $48.
Sub Sector Rotation
Cheat Sheet on Sub Sector Rotation levels
KBE $49 Adding
IHE $150 Adding
IBB $108 Adding
XT $37 Adding
The banking sector is showing its hand through $49 however below $46 could see a move back to the low $40s.
Slowly grinding higher, anything vs $76 is fine.
Added up through the recent highs however the pharma's lost there momo, will except some type of pull in as long as it holds up vs $142 its all fair game, next add up with be through $150
IBB Bio Tech
So far IBB has held $100 ($300 pre split) like a champ so far however still in a wide 8% range, so far we got two decent adds up in the middle of this range, the next spot with be $108 that will need to break, if we continue to flirt with $100 we should prepare for lower prices.
XT Exponential Tech
XT is a basket off 200+ younger tech stocks that are composed of developed and emerging market companies that create or use exponential technologies. Some of there top holdings other than NFLX, are INFY, SKY, GOBI, SPLK, XPO and many others. Think of XT as new (young) tech like MU while AAPL or AMZN technically are somewhat old tech. While MSFT, CSCO and INTC are legit dinosaurs. Regardless all we care about are the charts and $38.50 for 3rd times a charm looks as textbook as they come. Real out is vs $35, for now a feeler above $37 to start could make sense.
The New Big Picture Set Up
The Big Picture DIS $160+ 12 Month Price Target
It is starting to seem that for these bigger picture idea's, it is harder to really pick the exact day to get in and stay in for the major move, where for these idea's going forward similar to sector rotation. I am going to focus more on the spots to add vs the real outs to focus more on slowly building into each of the Big Picture Idea's to help separate away from the momentum buys that need to be exactly perfect.
This should in time help in two major factors, one will help instill more patience and also help nudge the idea of dollar cost averaging where you can really be in for the bigger % moves vs the heavier faster moves. There is no one with a gun to your head saying pick one or the other, just more of a mental mindset, where one might be a shorter term trade while the next might be something you want to set aside and hold.
For DIS we were already adding down near $99 vs $98 on super tight risk, and started to add $101. For now Big Picture the level that needs to break is $112 now you and I both know simply just buying $112 day 1 like trying to buy ALNY at $140 is a hard ask for most, yet if your already in from 10% lower, its much easier on the mental capital to add when the time is right.
When it comes to dollar cost averaging for each entry you want to be light, 1% of your overall capital could be a good starting place. Example if you have $100,000 you would invest $1,000 each time, also giving each add at least a week before adding again. If you have $10,000 it would be $100 or 1 share DIS at a time. Now sure this sounds boring AF and that's the point, when its boring you can let the stock breathe and you can hold through the ups and downs. Remember we are looking to get into this positions for the longer term, 3,6,12+ months, it might be boring the first few weeks with the positions, however you and I both know those small percentages add up in time. Same goes with DCA.
Big Picture Entry $112.05
Big Picture Target $160+
The Big Picture's Updated
The Big Picture NVRO $130+ 12 Month Price Target
NVRO has been setting up for this break for over a year now, we can see how $90 is still the level that needs to break and could just as easily still pull back in a bit, however in time NVRO is setting up for what could be a WIX type move.
Now I will be the first to admit that I mooked and took some profits early however that's life, if NVRO does break with some juice will be looking to sell at $107 to sell at that prior high than hold some for the Big Picture move.
Tried to be cute with NVRO earlier in the week and got ticked out by $.09 only to have to buy it right back at the same price two days later, the real out is vs $83, not going to let NVRO LULU us, $90 still seems to be the spot to add through however the day to day price action is showing that it might need to pull in a bit before really breaking this down trend with some authority when it does finally take out that prior pivot high, will need to be a hold at least to the 52 week high.
Big Picture Target $130+
The Big Picture MOMO $70+ 12 Month Price Target
MOMO has been on our radar as of late from a technical standpoint, however do you know what MOMO does as a business? Crazy question I know, however they are the Chinese Tinder. I don't want to get too deep into the fundamental story because were traders however knowing this information and seeing how successful both Tinder (owned MTCH) has been as well as Bumble (owned by Badoo private). Both extremely successful business here in the states, however in China its a much bigger market that people are willing to pay for. Now MOMO is a subscription business which is consistent however it is not a sexy bio tech. Need to hit up the Red Army and find more out about it if it really is the next Bumble of China or the next Tinder.
Chart wise could sneak in at $38 however it seems best to just let this thing really set up and take it through $40 and look to add above $46 which is where we should expect the real move to be.
That $38 seller in MOMO really flexing, for now seems that even if MOMO can bounce and tickle $38 it seems like a breakdown through $34 is probably going to be the more likely outcome which is fine, MOMO went on an almost 100% run recently, a little shake of the tree doesn't hurt us as long as we are not in.
Big Picture Target $70+
The Big Picture WVE $70+ 12 Month Price Target
We caught a nice move in WVE where a few of the members literally caught the top of the short term move for over 30%+ in a week, I on the other hand was not watching it as closely and got stopped out for most for a measly 19%, cue up the baby violins.
Recently it started to drift back down towards the prior breakout level of $40/$42, so far I have taken two small shots in it and see how I am just too early which is fine with me.
It closed under $40 and other than $37 below that line in the sand it has a far way to go until the next pivot. For now its just on the radar for adds above $42 for an eventually move to retest those prior highs and down down the line to take those highs out. Given the blood in the streets this week, felt it was best to have this more of as a stock to watch not a stock to go out and buy just yet.
The feeler add through $40 has been ok so far, WVE is starting to show us that it cares more about $42
will be looking to add through there in time.
The $42 entry gave us a nice 10% pop day 1 however we have seen this time and time again where if the stock cant really sustain a great day 2 follow through on huge day 1 moves they tend to fade it in time. One of the largest doji's one has seen where the indecision in WVE was a 15% range intraday was a sign to look for an exit to figure out whats going on. Got rid of the higher priced stock and sitting on the $40 adds. Any pull in vs $36 will be looking to add back up $38/$40 if given the chance.
Big Picture Target $70+
The Big Picture LULU $110+ 12 Month Price Target
This LULU has been wearing down the patience of most however Big Picture wise its just chilled and for the most part has been doing everything we would want in a stock. Consolidating at highs on tight risk. For this name to really get going still feel it needs to really shake the tree before we are going to see a powerful momentum break of $82. Lets look at MU for example.
MU had to shake the tree before that monstrous breakout, we want a shakeout in LULU to get ready for a feasty move through that $82, a push down through $75 would be ideal.
Now lets take a look at another name that spent a few months also consolidating near highs. Same name also had a shakeout that is barely noticeable on the chart now before ripping for months.
In LMT I just kept buying it the tightest flag for months only to eventually stop myself out the day before the start of what became a $100 point rally. LULU is reminding me of the same story.
We got jerked around for months in this LULU and it finally broke on great earnings, be patient, this is all new price discovery, pick an amount of stock that you are willing to give back to $77.89 and lock em away. Trade the rest how you see fit, however if we had to flip a coin and say LULU higher or lower than $78 in 3-6 months would have to say higher. Should be looking to at least to $100 for now.
Short term this tight trend line is one asking to break and shake the tree, however bigger picture if you give it the right room and time, and avoid trying to micro manage LULU it should pay you.
Big Picture Target $110+
The Big Picture JAZZ $220+ 12 Month Price Target
JAZZ has been off our radar for almost a year now as we last tried it through $156 however we were too early. Recently it has been started to set up for a move through $156/$160 eventually through that area we should see JAZZ take out those prior highs.
Almost 2 years in the making, $160 will be the level to buy.
Big Picture Target $220+
The Big Picture CVX $160+ 12 Month Price Target
We made a mistake when we were focusing on the energy sector and that was focusing on XOM sure chart wise it was a great value play and had the smallest amount of risk from our entry the overall headwinds were still south.
Yet the leader CVX received much more love. So far we can see how there's two key areas we want to watch, $120 and $134 while the real line in the sand has been above $100 in CVX for going back as far as October 2016.
If Energy continues its overall weakness as it hovers near support of its wedge, we want to keep an eye on CVX to see if it can hold up vs $100. If it can great signs where we can start small and add through levels. This will be a patient one. Remember this is a heavy thick oil name, not a light and wide bio tech.
This CVX has been moving in waves, down $10, up $10, down $10 up $10, had to add through $118 however seems that short term the oil names are running out of steam, still have the lower cost basis stock however not giving back anything in the higher priced ones. Took some off and will look to get back in once there is a more defined entry.
Big Picture Target $160+
Embrace the failures, they expose your weaknesses