Overall, it is important to remember that pullbacks in the market are a norm and to be accepted within the trading and investment community. These moments are amazing for getting started with investing and to learn trading. With investing, once the bottom has been identified or likewise solidified. The timing of this can determine some extra long terms gains, but overall time in the market is more important than timing the market. For traders, there is no better time to learn how to manage your risk and make intelligent maneuvers. Below we share this week some wonderful long terms stock as well as a few stocks that may be set for a swing trade!
$BAC – Bank of America Corporation
Investors are growing increasingly concerned about Wall Street banks, as lower quarterly earnings are anticipated following last month’s regional banking crisis. This is expected to impact overall profitability, coupled with the pressure of a slowing economy. On top of this, inflation and recession concerns related to the banking crisis are also contributing to the mounting pressure. Moreover, the cost of issuing debt is rising, and uncertainties surround the potential impact of a slowdown in consumer spending on credit creation, as well as expectations for higher regulatory requirements. All of these concerns are further compounded by persistent geopolitical risks.
- With the news in mind surrounding $BAC, as well as the overall market, it can be easy to make a case against buying $BAC, but finding an alternative strategy to short, such as with a Put Option. Although it should go without saying that there are just many unknowns and jitters within this current sector due to all of the recent negative news.
- Earnings are due by 4/18, this will be a tell-tale sign for how $BAC may trade for the next few coming months.
- Buying opportunities may be present after 4/18 earnings or there may be a play to take up.
- $BAC has been testing support around the $27 level, if we take a look back to the COVID panic-era, $BAC bottomed out around the $18 level but there are still a few heavy support areas in the $20’s before it gets to that point again. It may be realistic to see $BAC drop to the $24 level through its earnings, if they are negative in results.
- There is no question, however, that $BAC will return eventually and may be a good set-up for a long term play. DailyBubble would recommend to wait closer to earnings or even afterwards to see the results. Downside potential at this time is higher than average, it remains to be seen if this will have a larger impact than COVID, although this is doubtful.
Shares Outstanding: 8.09B Share Float: 7.98B
$AMZN – Amazon
Sources familiar with the matter reported to The Wall Street Journal that Whole Foods Market plans to reduce its reliance on outsourcing for food production by constructing commercial kitchens that will focus on preparing meals for its food bars and refrigerated cases. Amazon’s stock has recently experienced a slight decline, and the company has started charging for some UPS returns. The company’s shares closed at $102.06 on Friday, reflecting a 0.95% increase. Options expiring on Friday suggest that there was a significant increase in open interest at the $110 Call strike, indicating potential resistance at that level. Conversely, the $100 level could act as a support on the downside.
- Overall, DailyBubble stands bullish on Amazon. This is purely a long term stock that can be held in a Roth IRA.
- Amazon is rumored to have more layoffs during the 2023 fiscal year and is cutting back overall. It seems that the entire tech industry has headed this way and may lead the way in an overall market pullback, if this occurs for the remainder of the year.
- Cutbacks are further confirmed with Amazon charging for some types of UPS returns, it can be suggested that they are possibly charging for heavier returned items. Likely anything 50+ LBS., this is purely an educated guess.
- On a technical level, $AMZN has been trading in a channel between $100 & $105.
- Overall, DailyBubble believes that pricing for Amazon has yet to be set and is teetering between US economic troubles but on the other end may increase due to cutbacks. One may believe that $AMZN may make enough pull-backs to help their overall financial statements for the remainder of 2023.
Shares Outstanding: 10.22B Share Float: 9.25B
$CAT – Caterpillar Inc
Last week, shares of $CAT were observed to be trading lower due to growing concerns over a potential economic slowdown in the US, which is further compounded by recent weak economic data reports. As a key provider of machinery to construction companies and part of the Industrial Sector, $CAT is expected to be one of the major players alongside the Tech Industry in the impending market pullback. Despite this, investors seem to be maintaining a neutral stance, likely awaiting the company’s upcoming earnings report on 4/27 before making any major moves.
- $CAT is a great long term investment, however may have some woes throughout 2023, or at least once earnings are reported on 4/27.
- Support lies heavily on the $213-$215 level, which is currently being tested and may fall through leading up to its earnings.
- We believe that $CAT may easily pull-back to the $186-$190 level and may further this pull-back as 2023 moves forward.
Shares Outstanding: 517.30M Share Float: 511.18M
$RCL – Royal Caribbean Group
The luxury cruise line has made significant strides in resuming its operations after the COVID-19 pandemic. At the close of 2022, the company successfully resumed operations on 64 out of its 75 ships, a positive indication of its efforts to bounce back. Additionally, the company has expanded its fleet and global itinerary offerings, with expectations of serving over 8 million guests in 2023. The company’s load factors have surpassed expectations, boosted by an increase in close-in bookings, with pricing remaining elevated from 2019 levels. As of December 31, 2022, the company had amassed customer deposits worth nearly $4.2 billion.
- $RCL’s chart pattern is noteworthy and shows a bullish trend that has been consistent since early October, as observed on both the 4-hour and daily charts. If this trend continues, RCL is showing support at $60.
- It’s worth noting that a head and shoulders pattern may be forming on RCL’s chart, which is typically a bearish sign and should be monitored closely. Recent tension with Saudi could lead to a further decline due to the large ownership in the company (~8.2% ownership). Risks of investor sentiment, economic sanctions, oil prices, and political uncertainty make this an interesting chart.
- As of now, we will be monitoring the development of Royal Caribbean and will provide further updates on any price action changes.
Shares Outstanding: 255.19M Share Float: 219.97M
$NFE – New Fortress Energy – UPDATE
The price of West Texas Intermediate crude oil dropped 1% to $79.86 per barrel, while the global benchmark Brent crude contract saw a decline of 1% to $84.30 per barrel. Shares of New Fortress Energy (NFE) rose over 5% after Deutsche Bank initiated coverage on the stock with a buy rating and set a $60 price target. New Fortress Energy has a price target of $60.00 set for it. During Q4, the company reported an EPS of $0.87, an increase from the $0.72 in the same quarter of the previous year. Currently, the stock has a 52-week high of $63.06 and a 52-week low of $26.14. In the last trading period, New Fortress Energy’s closing price was $28.06.
- $NFE has been on a downward tear from its high of $60.06 in the last 6 months back in August 2022, with a small resurgence in November 2022, it has recently touched down to a substantially low price of $26.57.
- With the prolonged drop, current support is sitting right around the $27 range, however its next support sits at the $21.25 range. The next resistance levels may be seen at the $32 range and the $36 range.
- $NFE is apart of the Energy/Utilities Sector and may be set-up, both technically and economically to rebound to previous ATH’s. There is plenty of upside found within $NFE at current levels.
- Traders may look into this stock as a swing trade for a few months and may find a return. However, with its continual drop, it is important to note that just back in 2019 it was a penny stock before surging to $62.90 (ATH) in the beginning of 2020. With this said, NFE has a major support line at the $20 range but has established a foothold for long term growth through its profitability.
Shares Outstanding: 208.76M Share Float: 97.43M
This article provided by the DailyBubble team should only be considered as informational and/or entertainment by the reader. DailyBubble makes no representation to buy or sell any security or financial instrument within the article. Readers seeking investment advice should seek independent financial advice from a professional, and independently research and verify. The DailyBubble team wrote this article and may express its own opinions therein.