Grok AI came under heavy scrutiny in the past week over explicit deepfakes.
China banned Chinese firms from using US and Israeli cybersecurity software.
The Technology sector was dealt blow after blow in recent weeks, leading the sector to lag the overall market.
Is there a sector that’s rising alongside the market?
Yes, there is.
But before I share about this sector and the stock I think could soar in the near future, let’s review last week’s #PowerStocks pick: Reddit (RDDT).
Review Of Last Week’s Pick Of The Week
Reddit (RDDT) was last week’s stock pick.
It’s a popular social media platform and forum, with a market capitalization of over $46b.
After exploding in price by 19.5%, a pullback appeared.
Its share price had reached the support area identified and bounced. Did it reach my intended take profit level?
Unfortunately, its share price took a hit.
Am I still in the trade?
Head over to my Telegram Channel to find out!
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I know and understand that the allure of high returns without effort is highly attractive. It breaks my heart when I hear of people falling for impersonation scams.
To protect you from scams, please note that my team and I WILL NEVER solicit for any investment.
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Why Is Swing Trading Edison (EIX) Worth It?
Source: edison.com
Edison belongs to the Utilities sector, which has been rising hard and outperforming the overall stock market lately.
Blessed with a massive market capitalization of $24b, Edison is the 29th largest utilities company in the world.
While the shares of some large-cap companies suffer from lethargy, Edison’s shares tend to explode upwards consistently — each of its explosive upmoves measures between 4.6% and 14%.
Its share price could pull back in the coming days after a sharp 7.1% rise over just over a week.
What’s my game plan?
Where’s a favorable price area to buy its shares at?
Continue reading to get the details.
P.S. What if I told you that you could drastically gain control over your emotions of fear and greed, and master the stock market in a short amount of time?
My team and I have worked tirelessly to help you achieve results fast.
Click on the banner below to claim your stock course for free (limited time) now!
Performance Of US Stock Market vs Edison (EIX)
What is the 1st thing I’d want to know from this analysis?
I want to identify the trend of Edison’s share price.
Why?
Knowing the trend of its shares allows me to determine whether I’d look for a buying or shorting opportunity because following its price trend will sharply increase my chances of profitability.
Given the mighty uptrend in Edison’s share price, I’d like to identify a buying opportunity.
Great! But that’s not all.
I’ll compare the performance of the S&P 500 against Edison’s shares.
A stronger performer is more likely to continue bringing a higher return; therefore, buying the stronger performer is more likely to make my hard-earned money work harder.
While the S&P 500 had climbed 4.1% in the past 3 months, the shares of Edison shot up by 10.1% over the same time period! That’s a mighty outperformance by Edison of nearly 2.5x!
I want to buy its shares for an explosive swing trade.
But is this all to analyze?
How Explosive Is Edison (EIX)?
No, there’s still more to analyze to boost my chances of success.
Because I only wish to ride its next powerful upmove instead of hanging on to its shares, my holding period will be as short as a few days. Hence, I want its shares to have the ability to explode upwards fast.
Have Edison’s shares consistently exploded upwards?
Marking out the explosive upmoves for the past 11 months has left me stunned.
There are 23 huge explosive upmoves, each measuring between 4.6% and 14%!
What’s even more impressive?
Edison is the world’s 29th largest utilities company, enjoying an enviable market capitalization of $24b.
The share movement of such huge companies is usually more subdued, but not Edison.
Additionally, I appreciate that Edison enjoys a massive market capitalization, which provides an extra layer of security against manipulation. I don’t wish to lose my hard-earned money to manipulation that could be easily prevented!
Here comes the golden question: Is it time to buy the shares of Edison for an explosive swing trade?
Key Price Levels
As with many things in life, timing is key. Trading is no exception.
Buying an explosive stock at the wrong time can result in significant losses and emotional distress. This will cause you to lose confidence, and you’ll doubt yourself even when a fantastic trading opportunity arises straight from under your nose!
Is it time to buy the shares of Edison for an explosive swing trade?
You can have this insight by uncovering its key price levels (also known as support and resistance zones). And that’s what I’ve done in the chart above.
Because its shares have been soaring for over a week, I expect a temporary drop.
I’ve marked out a support area around $60.60. This tells us that Edison’s share price is likely to drop to around $60.60 before rising again.
Once this happens, I’ll be on the lookout for a bounce before buying its shares to catch its next explosive upmove.
Here’s a pro tip: Instead of staring at your screen, consider setting a price alert on your broker’s platform to be notified so that you can spend precious time with your loved ones.
Which Instrument Should You Consider Using?
Do you ever wonder about the instrument used to trade explosive stocks?
With 3 main trading instruments available – stocks, contract-for-difference (CFD), and options, you wonder which suits you best.
Since stocks (as an instrument) is easy to understand, I shall focus on CFD and options.
Here are the main similarities and differences:
CFD works like a mirror to stocks. When a stock rises $1, its CFD rises $1.
However, due to its unique pricing mechanism, your options price doesn’t rise by the same amount. In fact, depending on the market conditions, the price of your options contract may even drop!
Your CFD broker will charge you a finance fee for lending you money for your trade. However, no lending is required for options, so there is no finance charge.
Because there’s a finance charge by your CFD broker, CFD is not the ideal instrument for mid to long-term trades. On the other hand, options allow you to implement different strategies across time horizons.
Both CFDs and options are leveraged instruments because they allow you to control a larger market position with a smaller amount of capital.
While CFDs do not have an expiration date, options traders must pay attention to the expiration date of their options contracts.
You must be thinking, “What’s the beauty of trading options?”
Options are like smartphones. You can choose to use a smartphone for its basic or advanced functions.
And options don’t have to be all about Math and dry!
It can be made easy to understand through real-life analogies.
In the same way, you can implement basic and/or highly advanced strategies depending on your level of comfort.
Options allow you to be versatile in adapting to the shifting market conditions and capturing opportunities in the process.
Are you a CFD or options trader?
I’m glad to be fluent in both.
Finally, this is for educational purposes. Please perform your due diligence.
All images are taken from pexels.com, pixabay.com, sectorspdrs.com, tradingview.com, and unsplash.com, unless otherwise mentioned.
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The stock market is full of traps laid out by professional traders.
Many new traders are often left confused by conflicting signs and signals.
Worse still, ~80% of traders lose money.
This is because trading isn’t just about skill alone.
It includes the mastery of your emotions.
But what if I told you that you could quickly gain control over your emotions of fear and greed and master the stock market?
My team and I have worked tirelessly to help you achieve results fast.
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