Dollar General Corporation (DG), which has beaten the earnings per share (EPS) estimates that when the discount retailer of the results presented on May 28. The shares are listed higher and set its intraday high of $194.84 on the 1st of June.
Almost every village has a Dollar General, a retail store where customers can buy almost all types of consumer goods. The stock could have been purchased between 12 March and 31 March, between its semi-annual and annual pivots at $147.46 and $144.22, respectively.
The stock closed Friday, June 5, for $185.66, up 19% year to date, and in the bull market territory of 48.5% above its March 16 low of $125.00. The stock is 4.7% below its June 1 of the all-time high of $194.84.
Dollar General is not cheap, as its P/E ratio is 23.74 with a dividend yield of just 0.78%, depending on the trends. To increase the store traffic, the retailer is expanding its focus on both consumables and discretionary goods.
The daily chart of Dollar General
Dollar General stock has been above the cross of gold since Sept. 6, 2017. This buy signal is produced when the 50-day simple moving average rose above the 200-day simple moving average to indicate that higher prices will follow. This buy signal, followed by the stock up to its June 1, 2020, a high of $194.84.
The stock could have been bought at its meeting of swivel $144.22 between 12 March and 27 March. This occurred when the stock dipped below its 200-day simple moving average.
Dollar General is back above its 50-day and 200-day simple moving average on April 2, and it is moved above its quarterly pivot at $170.31 on April 13. The stock is now above its monthly value level of $171.44 but below this week’s risky level is $193.27.
The weekly chart for Dollar General
The weekly chart for Dollar General is positive, but overbought, with its five-week modified moving average of $179.42. The stock is well above its 200-week simple moving average of $109.00, which is also the return to the average. This average was tested during the last week of September. 1, 2017, while the average was $70.75.
The 12 x 3 x 3 weekly slow stochastic reading is scheduled to hit 89.01 this week, unchanged since June 5. If the reading rises above 90.00, the stock will be in an inflation parabolic bubble formation.
Trading strategy: Buy Dollar General stock on the weakness of its monthly and quarterly pivots at $171.44, and $170.31, respectively, and reduce the holdings on the strength of its weekly risky level at $193.27.
How to use my value levels and risky levels: The share price closing price on Dec. 31, 2019, has been an entry to my proprietary analytics. Half-yearly and annual, the levels are still on the charts. Each calculation uses the past nine closes in these time horizons.
The second quarter of 2020 the level has been established based on the 31 March, close by, and the level of the month of June has been established on the basis of the May 29 close. New weekly levels are calculated following the end of each week, while new quarterly levels occur at the end of each quarter. Half-yearly levels are updated at mid-year, the levels are set throughout the year.
My theory is that nine years of volatility between the farm are to assume all possible bullish or bearish event for the stock are taken into account. To capture the volatility of stock prices, investors should purchase shares of the weakness of a plan, the value and reduce the holdings of the strength to a risky level. A pivot is a level value of the risk level that was violated in its time horizon. Hubs act as magnets that have a high likelihood to be re-tested prior to their time horizon expires.
How to use 12 x 3 x 3 weekly slow stochastic readings: My choice of using 12 x 3 x 3 weekly slow stochastic readings has been based on the backtesting of many methods of reading the stock prices of the momentum with the objective of finding the combination that resulted in the least number of false signals. I’ve been following the stock market crash of 1987, so I was happy with the results of more than 30 years.
The stochastic reading covers the duration of 12 weeks, high, low, and close for the stock. There is a row of calculation of the difference between the highest and the lowest compared to the farm. These levels are modified for a fast reading and slow reading, and I found that the slow playback will work best.
The stochastic reading scales between 00.00 and 100.00 with readings above 80.00 considered as overbought and readings below 20.00 regarded as oversold. A reading above 90.00 is considered to be a “swell parabolic bubble” of the training, which is usually followed by a decline of 10% to 20% over the next three to five months. A reading below 10.00 is considered to be “too cheap to ignore,” which is usually followed by a gain of 10% to 20% over the next three to five months.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.