The J. M. Smucker Company (DLSU), which has beaten the earnings per share (EPS) estimates for the third consecutive quarter when it reported results before the open on the 4 June. The reaction has been negative, his advice has been disappointing. Smucker stock gapped below its 50-day simple moving average (SMA) and traded as low as $104.15 June 12. The stock is now between monthly and semiannual pivots at $106.72 and $109.43, respectively.
The stock closed Wednesday 17 June, at $108.07, up 3.8% year to date, and in the correction of a territory to 14 per cent below its April 21 high of $125.62. The stock is also 17.6% above its March 16 low of $91.88. Smucker is cheap, with a P/E ratio of 12.45 and a dividend yield of 3.26%, according to the trends. This makes the stock of a company suitable for value investors.
The daily chart for Smucker
The daily chart for Smucker shows that the stock had been moving sideways to down follow-up to its 200-day simple moving average. Then there was a sudden burst of extreme volatility. The stock has fallen to its March 16 low of $91.88, and then jumped to as high as $121.39 March 17. Then, the stock has fallen to $93.41 on the 23rd of March.
It was followed by a strong increase of the volatility to as high as $125.62 on the 21st of April. This type of continued volatility, investors on the sidelines. Of the top, the stock traded around its monthly pivot at $106.72 between 8 June and 16 June, before trading around its semi-annual pivot at $109.43 over the last two days.
The weekly chart for Smucker
The weekly chart for Smucker is negative with the stock below its five-week modified moving average of $110.06. The stock is also below its 200-week simple moving average, or the return to the average, to $115.94. Smucker stock has been below this key average since the week of May 22.
The 12 x 3 x 3 weekly slow stochastic reading should decrease to 50.21 this week, down from 57.58 on 12 June. During the week of May 17, 2019, this reading has been 96.64, put the broth in a “swell parabolic bubble” of the training, which has led to the low $91.88 on March 16.
Trading strategy: Buy Smucker stock on the weakness of its monthly pivot at $106.72 and reduce holdings on strength to the 200-week simple moving average at $115.94. The monthly and semiannual pivots at $106.72 and $109.43 will probably be magnets until the end of the month of June.
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.