3 Stocks I Saw on TV (MCD, M, SONC)- June 29, 2016
MCD SONC M
Every night we watch the same shows, Fast Money and Mad Money, and we want to USE those ideas the grow OUR money. Well good trading takes more than just pushing the buy button, the next morning, on the stocks you saw on TV last night. I’m here to help you make money on THESE 3 stocks I saw on TV.
We’re going to start with food here, McDonald’s ( NYSE:MCD ). They were chatting about it last night on Fast Money. Basically everybody likes it, but it’s a wonder if whether you like the stock or not, as opposed to just the Egg McMuffin, which by the way, before this brokeout, I was the guy pounding the table saying, “Dude, all day breakfast meal, that pretty much solved Adam Sandler’s problem in Big Daddy,” I liked it. I still like McDonald’s ( NYSE:MCD ) here. This is important, the stock is looking a little kind of head and ‘shouldery,’ almost, with a neckline across there. That’s on the weekly chart. That’s one way to look at it. The other way to look at it is this, my preferred way: There’s your line, first of all a bounce here to start it, a bounce here to perpetuate it, and a bounce here to confirm it. So we’ve got this support line here, with the weekly low where you want to be watching this. So that puts it right here. Coincidentally at the 200-day moving average.
So here’s the deal: I think this stock is at a low-risk buy point. I’m not talking high probability buy point, I’m talking a low risk buy point. Because the only reason you want to buy a stock is because you think it’s going higher. So if you THINK this is going higher, then what’s going to confirm that it isn’t going higher? Not any little pullback, but a pullback that goes BELOW this level, below the 200-day moving average. So frankly, I think you buy it here, maybe you even get a pullback of $1.00 or something like that. But you want to buy it as close to the 200-day moving average as you can, and you ditch it if it falls below and into this red box.
Now, another food company. Cramer was talking to the CEO of Sonic ( NASDAQ:SONC ); he likes the company. I’m looking at the stock, here’s what I see: I see a whole lot of shaking going on, more than a Jerry Lee Lewis tune. This is a sideways consolidation. It’s in a little bit of an uptrending channel. Now, this is what we’re looking at, actually kind of a broadening formation. It turned out to be a good buy. Turned out to be a good buy. Here, we’re waiting for it to turn out to be a good buy. I would be more inclined to buy Sonic ( NASDAQ:SONC ) if it rose above $28.00. I can put a stop a little bit below there. And then if it continues past $30.00, which is the 200-day moving average, THEN I would be adding to that position. So I’m pretty loaded up by the time the stock gets above 30.00, IF it gets above 30.00. But you’ve got to watch this broadening formation, where both support and resistance are moving up, but resistance is kind of moving away. Because what this is doing is setting up a lower high. And if this hits a lower high, or even an on par high here, this is when you wind up selling the stock. So that’s my take on Sonic ( NASDAQ:SONC ).
Now, the last thing I want to cover is Macy’s ( NYSE:M ). Cramer was talking about all the retailers, basically which one to buy. And he was looking at all kinds of fundamental aspects of these various companies. Free cash flow, dividends, etcetera, etcetera. And I’m just looking at the charts. Cramer was looking at Nordstrom ( NYSE:JWN ), JC Penny ( NYSE:JCP ), Kohls ( NYSE:KSS ), Sears ( NASDAQ:SHLD ), and then finally Macy’s ( NYSE:M ). I actually like Macy’s ( NYSE:M ) the best with respect to the chart. We got a low here, big, huge high volume move, down here. And then since this last low we’ve got a couple of higher lows, but this is close to the 50-day moving average. This is not my sector to begin with, I’m just covering 3 Stocks I Saw on TV, not 3 Stocks That I Want in My Portfolio. But Macy’s ( NYSE:M ), in my view, is the best one of all of these. I think you wait for the stock to CLOSE above the 50-day moving average. Once it rallies, IF it rallies back to test the 200-day moving average, then you lighten up. Because look, since this stock broke support last year, it has been absolutely crushed. I think this is probably THE bottom, but that’s not to say that this is a new uptrend. It’s just to say that is THE bottom and we could see some sideways drifting for a while.
3 Stocks I Saw on TV Free Chart