Happy hump-day, everybody, though if you were counting on some bullishness from the market then Wednesday's action wasn't especially happy. Don't worry - we have something that'll cheer you up.
First things first though. The primary item I want to cross off the checklist today is an apology for any confusion we may have created with the time and date we told you Staffing 360 Solutions (STAF) would be hosting its earnings call and webcast next Wednesday. It will still be at 9:00 am EST. But, next Wednesday isn't the 9th.... it's the 7th, just as Staffing 360 Solutions said it was in its press release last week. I can't even blame it on fat fingers. I just flat out hit the wrong button on my keyboard. Fortunately, everyone seems to have figured it out anyway. I just want to make sure we're all clear on the time and day.
We'll try and send a reminder closer to the event's date, but in case we don't get a chance to, the call can be accessed for U.S. callers by dialing (877) 407-0778. UK callers should dial (800) 756-3429, and other international callers should dial (201) 689-8565. A playback of the conference call will be available until September 30th, 2016. To hear the playback, dial (877) 481-4010 within the United States or (919) 882-2331 internationally and use replay ID number 10067.
On other fronts, has everyone seen what's been going on with Vitality Biopharma (VBIO) lately?
We can't say we're surprised - we knew this trading idea could catch fire. It was just a matter of finding the right catalyst. Looks like it was the updated look from SeeThreEquity posted on Monday. Make no mistake though... if it wasn't SeeThruEquity's revised look and upped price target, it would have been something else.
It's not the backstory or opportunity we want to hash out today, however. It's the chart of VBIO. Something just flipped the "on" switch, and it's been moving on huge volume, snapping it out of a converging wedge pattern.
This is a big deal, for more reasons than you might recognize at first glance.
For starters, a break out of a triangle or wedge pattern is big simply because it unleashes a lot of pent-up energy. The volume is a big deal just because it suggests there were and still are a lot of buyers waiting in the wings. Perhaps more than anything though, this chart of Vitality Biopharma is interesting because the breakout is taking shape after the convergence of all the key moving average lines.
Stocks move in cycles of hot and cold, and the way all those lines have entwined themselves says we're ready to move from a cold phase to a hot phase. This bullish jolt may be the beginning of that move.
Like we said, it's not all that surprising. The cannabis and medical-marijuana space is one that investors love to love, and traders are always seeking out the next big thing in this sliver of stocks. If for no other reason than the hype, VBIO could make for a great trade.
Here's the SCN's first look at Vitality Biopharma, in case you missed it.
As for the market... you know, you have to give some credit to the bulls. If nothing else, they're persistent. Today could have been very ugly, but by the time the closing bell rang the buyers had undone the bulk of the damage, and kept the indices clear from the cliff's edge. While we think the effort is ultimately a lost cause, their fight is worth remembering in the future.
I suppose in the grand scheme of things we can't be all that surprised the market staged a rebound effort where it did. Today's low around 2160 for the S&P 500 pretty much underscored Friday's lows at the same level. And, if you look back further on the chart, you can see 2160 was a key support area in late July.
You'll also see the S&P 500 temporarily pulled below the lower Bollinger band today before bouncing back above it. As long as that floor holds up on an end-of-day basis, the bulls still have a fighting chance. Ditto for the way the VIX started to punch through its big ceiling at 14.0 but undid the move before the day came to a close. Heck, the hammer shape of today's bar in some ways says we just flushed out any sellers and the buyers are tiptoeing back in again.
All the same, we think the bears just tipped their hand... again. The buyback effort seems to have come from a crowd trying to convince themselves that stocks still have more upside than downside. They're so desperate to convince themselves and others that the market is safe here, they'll even keep pouring more money on any dip.
Don't think for a minute it doesn't happen. It's kind of like a gambler trying to buy his way out of a bluff by putting more and more money into the pot.
Whatever the case, we still contend this market's going to have to give up more than a little ground before it goes any higher. September is the month it's most apt to happen...
... not that I really care. I'm more than happy with the 28% gain I booked on Constellium (CSTM) today, after the Under the Radar Movers newsletter recommended it on Monday. That's right - the URM banked a 28% stock trade in just three days.
The thing is, it's actually not unusual for the Under the Radar service. That's not to say they all move that well that fast, because they don't. You don't need them all to move that rapidly though. If you only get a few trades like that a year, you're still apt to outperform the overall market.
If your portfolio could use a few more trades like the Constellium trade, you can become a member of the URM newsletter for less than a dollar per day. You're not going to find a better deal than that.