Cheap and Volatile market

“Profitable small caps are dirt cheap” ~ One analyst. 

Once upon a time, the market was extremely expensive but very easy to trade and invest in. Now a big part of the market is cheap but very volatile. Trading has become a nightmare and no matter what you buy, the stock just in a few days loses everything. Large-cap stocks are moving like penny stocks making a violent move. In this kind of market, here are a few interesting price action stories to watch out for.

Tyson Foods = Inflation and Earnings Play

The company reported fiscal first-quarter adjusted earnings of $2.87 a share on revenue of $12.9 billion. Analysts surveyed by FactSet expected earnings of $1.93 a share on revenue of $12.17 billion

Reaction – Classic Breakout to a New High

I will buy at the current market price and ride the stock. The stock is a play on rising meat prices and inflation. It is trading at a multiple of 11 and offers dividends too.

Phunware PHUN ~ A speculative stock with a genuine story

Phunware is a political play. Today the stock surged due to a ”strategic political partnership” with Campaign Nucleus, an AI-based digital platform set up by Donald Trump’s former campaign manager Brad Parscale. We are in a weird market environment and this is one trade that can surprise us on the upside. One can take an extremely small position with a stop loss below 2.69. Do not invest if you have no risk appetite. 

The theme in Bull Market ~ Marine Shipping

I covered it on Jan 28 2022 as few stocks made new highs and the stock of this sector continues to surprise. ZIM and DAC have been my fav.

Focus on Gold and Silver

Trade Sheet:

Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purposes. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers