Hope you had a great weekend. Here’s Monday’s edition of Stock Surge Daily.
Chart of the Day
This is e.l.f. Cosmetics (ELF), a producer of mass-market skincare and cosmetic products. But what’s important here is that it’s one of those stocks that just won’t quit.
Its stock price is up 163% since May – and it shows no signs of slowing down.
See that yellow line on the chart? That’s the 10-day exponential moving average (EMA). Unlike simple moving averages (SMAs), EMAs give a higher weighting to the stock’s most recent price action. That’s why I prefer EMAs for analyzing a stock’s short-term trends.
I’ve found that powerful stocks with a lot of momentum behind them like ELF will ride their 10-day EMA during explosive moves higher.
This stock is a top performer and worth keeping an eye on. A sudden breakout in its 10-day EMA might be a sign it’s time to act.
Insight of the Day
If you’re following the Fed, you’re following the herd – and by definition, the herd can never outperform the market.
Is there a bigger influence over the stock market right now than Fed Chair Powell’s mouth? Investors scrutinize every single word – then act accordingly.
He says the war on inflation is far from over? That must mean more painful rate hikes on the horizon – time to sell! He says the economy isn’t looking good? That could mean the Fed may be forced to slow down its rate hikes (or even slash them) – time to buy!
Sure, you don’t want to “fight the Fed”. But if your entire strategy is to just react to what Powell’s words could imply – you’re just a sheep following the herd. And since the herd is the market, you can never beat the market by following the herd.
That’s why my trading philosophy is centered around rising above the herd, to study what the small successful minority is doing – and then emulating it.
And one of the most powerful strategies I’ve found is (unsurprisingly) being used by many of the most corrupt politicians sitting in Congress right now – including soon-to-be-fired Speaker of the House, Nancy Pelosi. Want to find out more about this strategy? Watch my full presentation here.
Embrace the surge,
Editor, Stock Surge Daily