When searching for trades, I typically focus on fundamentals first and use the chart as a tool to time the trade and estimate the anticipated move. But from time to time, a technical breakout is so powerful it cannot be ignored, and the fundamentals play a supporting role. #-ad_banner-#Today’s pick is breaking out from a highly reliable chart pattern. This same pattern delivered gains of 27% in just two weeks in Darden Restaurants (NYSE: DRI) and 70% in less than two months in Mattel (NASDAQ: MAT). A breakout from a… Read More

When searching for trades, I typically focus on fundamentals first and use the chart as a tool to time the trade and estimate the anticipated move. But from time to time, a technical breakout is so powerful it cannot be ignored, and the fundamentals play a supporting role. #-ad_banner-#Today’s pick is breaking out from a highly reliable chart pattern. This same pattern delivered gains of 27% in just two weeks in Darden Restaurants (NYSE: DRI) and 70% in less than two months in Mattel (NASDAQ: MAT). A breakout from a wedge formation is one of the most compelling, explosive and successful technical signals I use.  The wedge patterns that led to winning trades in MAT and DRI were of the bearish variety. Now we have an opportunity to jump on a breakout from a bullish wedge in DSW Inc. (NYSE: DSW). The pattern emerged on DSW’s chart after the shoe retailer announced better-than-expected Q3 earnings and raised its full-year guidance. Shares gapped up on the opening on Nov. 25, breaking out of a channel and hitting an eight-month high. The stock then made a series of lower highs. Read More

Intel (NASDAQ: INTC) recently got the “Barron’s bump,” with the influential publication calling for 30% upside over the next two years as the company’s mobile chip division continues to catch up with competitors. Yet, Barron’s may have underestimated the speed at which this rally could take place, as Intel is at the forefront of what could be the next great technological revolution. And I think traders can leverage this into 76% gains in the next few months. No one would deny that Intel was late to the mobile device party, i.e., tablets and smartphones. It largely focused… Read More

Intel (NASDAQ: INTC) recently got the “Barron’s bump,” with the influential publication calling for 30% upside over the next two years as the company’s mobile chip division continues to catch up with competitors. Yet, Barron’s may have underestimated the speed at which this rally could take place, as Intel is at the forefront of what could be the next great technological revolution. And I think traders can leverage this into 76% gains in the next few months. No one would deny that Intel was late to the mobile device party, i.e., tablets and smartphones. It largely focused on “old tech,” making chips for PCs while companies like Qualcomm (NASDAQ: QCOM) and ARM Holdings (NYSE: ARM) rushed into the mobile processor space.  Intel’s management has acknowledged their mistakes and has vowed to capture market share with aggressive pricing, superior chip performance and integration. To that end, the company recently combined its PC and mobile units to increase efficiency.  #-ad_banner-#The transformation is starting to pay off. Midway through this year, the company had 4% to 5% of the global tablet market. If it meets estimates to ship 40 million tablet chips this year, it will… Read More

Back in 2010, as the U.S. was trying to claw its way out of the financial crisis, unemployment was at 10%, consumer confidence was below 50, and oil prices… were at about the same level they are today. The price of West Texas Intermediate (WTI) crude oil plummeted more than 30% since June, hitting a four-year low this week at $73.25 a barrel. #-ad_banner-#This marks the fourth major correction in oil prices since the beginning of the Great Recession. And a look back shows an emerging trend that traders could leverage into 50%-plus profits in the next few months.  In… Read More

Back in 2010, as the U.S. was trying to claw its way out of the financial crisis, unemployment was at 10%, consumer confidence was below 50, and oil prices… were at about the same level they are today. The price of West Texas Intermediate (WTI) crude oil plummeted more than 30% since June, hitting a four-year low this week at $73.25 a barrel. #-ad_banner-#This marks the fourth major correction in oil prices since the beginning of the Great Recession. And a look back shows an emerging trend that traders could leverage into 50%-plus profits in the next few months.  In the chart below, we see that no prior sell-off since 2009 has eclipsed the low of the previous year — let alone pushed prices to a multiyear low. This tells me that oil is in a very oversold condition.  Further, the three previous corrections have lasted an average of about five months, which is how long the current sell-off has been going on. Even more interesting, is that prices regained an average of 64% of their drop within six months of their low.  I doubt that oil will trade back to its highs above $107 a… Read More

We are just two weeks away from the day when Americans gather with their families to consume over 45 million turkeys. Butterball, the largest producer of turkey products in the United States, is a subsidiary of privately owned Seaboard Corporation, but another type of poultry has piqued my trading interest. Turkeys are always a hit during the holidays, but the real story here is growing global meat consumption, specifically poultry.  According to the agricultural outlook from the Organisation for Economic Co-operation and Development and United Nations’ Food and Agriculture Organization, poultry will overtake pork as the most consumed meat in… Read More

We are just two weeks away from the day when Americans gather with their families to consume over 45 million turkeys. Butterball, the largest producer of turkey products in the United States, is a subsidiary of privately owned Seaboard Corporation, but another type of poultry has piqued my trading interest. Turkeys are always a hit during the holidays, but the real story here is growing global meat consumption, specifically poultry.  According to the agricultural outlook from the Organisation for Economic Co-operation and Development and United Nations’ Food and Agriculture Organization, poultry will overtake pork as the most consumed meat in the world by 2020. In the United States, chicken is already the No. 1 consumed meat, surpassing pork in 1996, and overtaking beef in recent years. Tyson Foods (NYSE: TSN) is one of the world’s largest meat processors and the second-largest food production company in the Fortune 500. It provides 21% of all chicken produced in the United States, which accounts for nearly one-third of its revenue. #-ad_banner-#Tyson provides birds, feed and technical advice to poultry producers, who provide labor, housing and utilities. While the growers are insulated from changes in commodity prices for chicken and feed ingredients,… Read More

Homeownership in the United States is at a 19-year low at just 64.4%, according to a recent Census Bureau report. This may sound like a negative, but it is actually fueling an incredible opportunity for traders.  Rents are on the rise and vacancies are low, allowing a handful of companies that control a large portion of the U.S. rental market to prosper. Today, I’m going to tell you how you can leverage this trend into triple-digit profits in less than five months. According to real estate research firm Reis, apartment rents have risen for 23 straight quarters, increasing to an… Read More

Homeownership in the United States is at a 19-year low at just 64.4%, according to a recent Census Bureau report. This may sound like a negative, but it is actually fueling an incredible opportunity for traders.  Rents are on the rise and vacancies are low, allowing a handful of companies that control a large portion of the U.S. rental market to prosper. Today, I’m going to tell you how you can leverage this trend into triple-digit profits in less than five months. According to real estate research firm Reis, apartment rents have risen for 23 straight quarters, increasing to an average of $1,111 a month in the third quarter. This puts rent prices more than 15% above levels seen at the end of the recession in 2009. While rates are going up, rental vacancies are near a 14-year low. The rules of supply and demand dictate further acceleration in rents. #-ad_banner-#Fueling this trend is steady job growth combined with stricter mortgage qualifications making it harder to get a home. Additionally, with the housing market crash in the not-so-distant past, many would-be buyers are nervous to take the plunge. For those who do qualify for loans and are ready… Read More

Amazon.com (NASDAQ: AMZN) may have disappointed shareholders Friday with another earnings miss, but all I see is opportunity.  At this very moment, there is a screaming post-earnings buy signal on the charts that has worked out 100% of the time over the past two years. This signal is not something most investors would spot, but I use it frequently — and with great success.  It doesn’t hurt that I’m intimate with Amazon’s chart patterns, statistics and earnings trends. Our last technical trade in AMZN (although not an earnings-related trade) netted us 51% in less than two… Read More

Amazon.com (NASDAQ: AMZN) may have disappointed shareholders Friday with another earnings miss, but all I see is opportunity.  At this very moment, there is a screaming post-earnings buy signal on the charts that has worked out 100% of the time over the past two years. This signal is not something most investors would spot, but I use it frequently — and with great success.  It doesn’t hurt that I’m intimate with Amazon’s chart patterns, statistics and earnings trends. Our last technical trade in AMZN (although not an earnings-related trade) netted us 51% in less than two months. This time, I see an opportunity for 65% gains before year end. AMZN sold off to the tune off 8% Friday following its third-quarter earnings release after the close on Thursday. If investors were truly running for the hills, though, we would have seen a much more violent move and the rally from the pre-market prices would have been absent. #-ad_banner-#​CEO Jeff Bezos has been very clear with investors and the media that he is focused on the bigger picture rather than quarterly results. Back in 1997, he informed them that he would be spending… Read More

The small-cap Russell 2000 is officially in a correction, falling as much as 12% from its September high. Even after this big drop, my analysis uncovered three major indicators that point to another double-digit decline.  While any one of these on its own would be enough to justify a bearish trade, the fact that all three are in agreement makes for a uniquely compelling case. And with today’s strategy, traders can use the iShares Russell 2000 (NYSE: IWM) to leverage that decline into 87% potential profits in five months or less. Indicator No. 1: Stats are Not… Read More

The small-cap Russell 2000 is officially in a correction, falling as much as 12% from its September high. Even after this big drop, my analysis uncovered three major indicators that point to another double-digit decline.  While any one of these on its own would be enough to justify a bearish trade, the fact that all three are in agreement makes for a uniquely compelling case. And with today’s strategy, traders can use the iShares Russell 2000 (NYSE: IWM) to leverage that decline into 87% potential profits in five months or less. Indicator No. 1: Stats are Not on the Russell’s Side Bull markets are said to occur when equity indices climb at least 20% over a period of several months or more, usually during a period of economic expansion. Since the Great Depression, only one bull market has lasted more than a decade, with the average length around three years. The average return of the Dow during a bull market period is about 140%, and the median return is around 90%. #-ad_banner-#We are now five and a half years into the current bull market with the Dow up 151%, the S&P 500 up 180%, and the Russell… Read More

Rumors of the Ebola virus in the United States are spreading like an epidemic across the news and social media. As scary as the virus is, the likelihood of an outbreak here has been grossly exaggerated, and the “Chicken Little” effect is spawning opportunities in the market.  To be clear, I’m not making light of this very serious situation. My goal is to show you how a logical, rational investor can profit from an irrational reaction by the masses.  The bravest and smartest investors look for opportunity when others are panicking. Warren Buffett is one of… Read More

Rumors of the Ebola virus in the United States are spreading like an epidemic across the news and social media. As scary as the virus is, the likelihood of an outbreak here has been grossly exaggerated, and the “Chicken Little” effect is spawning opportunities in the market.  To be clear, I’m not making light of this very serious situation. My goal is to show you how a logical, rational investor can profit from an irrational reaction by the masses.  The bravest and smartest investors look for opportunity when others are panicking. Warren Buffett is one of the greatest investors of all time, and he is also a known contrarian. During the throes of the financial crisis in 2008, he said, “A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful.” Buffett famously made a bullish bet on Goldman Sachs (NYSE: GS) in 2008, when most people wouldn’t go near a bank stock. The trade netted him $2 billion over a four-year period. This 40% return was far from his most successful trade, but it is a great example of a well thought out investment… Read More

It’s official: Chinese e-commerce juggernaut Alibaba (NYSE: BABA) goes down as the biggest U.S. IPO in history. Shares were listed at $68 on Friday. By the close, they had soared 38% to $93.89, giving Alibaba a market cap that is bigger than rivals Amazon (NASDAQ: AMZN) and eBay (NASDAQ: EBAY) combined. #-ad_banner-#Alibaba also handled more in transactions in 2013 than Amazon and eBay combined, booking $248 billion. Controlling 80% of China’s e-commerce market, it is clearly a force to be reckoned with. The excitement on Wall Street is palpable and has… Read More

It’s official: Chinese e-commerce juggernaut Alibaba (NYSE: BABA) goes down as the biggest U.S. IPO in history. Shares were listed at $68 on Friday. By the close, they had soared 38% to $93.89, giving Alibaba a market cap that is bigger than rivals Amazon (NASDAQ: AMZN) and eBay (NASDAQ: EBAY) combined. #-ad_banner-#Alibaba also handled more in transactions in 2013 than Amazon and eBay combined, booking $248 billion. Controlling 80% of China’s e-commerce market, it is clearly a force to be reckoned with. The excitement on Wall Street is palpable and has everyone looking for the best way to profit. Buying shares of BABA may be appealing to some, but current valuations are rich and the company is still influenced by a communist government. I prefer to look for companies that will benefit directly from Alibaba’s growth and the e-commerce trend in general. Two names that will see continued windfalls from the societal shift toward e-commerce are package delivery companies UPS (NYSE: UPS) and FedEx (NYSE: FDX). Of the two, one stands out in growth, valuation and penetration in China. But the Street doesn’t seem to… Read More

Over the years, I’ve been successful trading weather patterns as they relate to commodities such as crude oil, gasoline and grains. As unpredictable as the weather can seem, there are patterns, and traders who get ahead of the crowd can exploit them for reliable profits. Today, I’m going to share one of my favorite seasonal trades with you, and that is the tendency for natural gas prices to rise in the winter months as the colder weather spurs demand for use in home heating. Source: U.S. Energy Administration For seven of the past 10 years, the price… Read More

Over the years, I’ve been successful trading weather patterns as they relate to commodities such as crude oil, gasoline and grains. As unpredictable as the weather can seem, there are patterns, and traders who get ahead of the crowd can exploit them for reliable profits. Today, I’m going to share one of my favorite seasonal trades with you, and that is the tendency for natural gas prices to rise in the winter months as the colder weather spurs demand for use in home heating. Source: U.S. Energy Administration For seven of the past 10 years, the price of natural gas has risen between the beginning of September and the end February, with an average gain of 17.6%. The Farmers’ Almanac predicts the 2014-2015 winter will again bring record cold temperatures for most of the nation. And with natural gas prices near historical lows, this would all but guarantee higher prices over the next few months. #-ad_banner-#Now, you’re probably wondering, if this is the case, why aren’t natural gas prices rising now?  Commodities are different than stocks in that the average person doesn’t go out and buy natural gas, store it in a tank, and then sell it… Read More