US ideas – low volatility names (Nov 29, 2020)

Most of the ideas here are not actionable right away. And it is expected as the markets ran up a lot in November and it needs a lot of guts to jump on the train right now. Hence, I am now looking for stocks that are already taking a breather before potentially starting another leg up (if at all).

WDFC – gapped up post earnings on Oct 21. Putting this on my watchlist as it consolidates over next couple of weeks.

SAIA – wedging up price action post a small pull back (7-8%ish from Nov peak). Placing this on watchlist too as I want to see another small contraction develop before it breaks out of Nov high. From fundamental perspective, the whole transportation sector did well, so it’s probably the sector tailwind.

CULP – this is developing into a good pullback buy setup as it broke out of a nice vol contraction pattern. Fundamentally, it doesn’t look good yet, easily inferred from the downtrend that began in Aug 2018. But the market is always trying to smell out future outcomes. In that case, I’ll put this stock on my watchlist as well.
Things I don’t like about this setup:
– Low volume breakout from the pivot

IAA: This looks interesting as a swing trade idea, finding support around 20DMA and currently hovering around it.

BLL: Tightening up on right side, will observe it for another 1-3 weeks.

DORM: finds support at 50DMA and did that on Friday as well. I don’t expect it to be a quick mover on upside but looks decent risk wise for a small move up.

Charts sourced from stockcharts.com

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Disclaimer: This is not investment advice, please do your research before committing capital.