Expect Slower Shipping & BTC's Breakout

Oct 03, 2021 | Swing Traders can profit from a slowdown in supply chains?

Weekly Newsletter- Week of 10.03.2021 

USPS: Now Slower & More Expensive? 

The United States Postal Service (USPS) recently rolled out a new initiative aimed at lowering its long-term debt. The new initiative was met with criticism as this plan calls for slower mail and increased price hikes for its consumer. The changes, which include longer first-class delivery times and limiting to overall post office hours of operation are all part of the Postmaster General’s 10-year plan entitled “Delivering for America”. 

Delivering for America 

Ironically enough, one of the main changes being implemented as part of the Delivering for America plan is a slower delivery time for first-class mail. The plan was originally outlined earlier this year as part of a 58-page memo which also includes advanced package process equipment, upgrades to post offices, uniform updates, and new tech including mobile devices for letter carriers. The controversial plan aims to make the post office “more competitive and more modern”. The plan also includes a new energy-friendly fleet of delivery vehicles. 

Slower Mail? 

Americans around the country may begin seeing a slowdown in their mail delivery services as new procedures were recently implemented last Friday. Beginning on October 1st, new service standards are expected to lengthen delivery times for upwards of 40% of its total mail volume. This means, some mail may take upwards of 5 days instead of its usual 2 days. The move is meant to realize new cost efficiencies by emphasizing ground transit over air transit. The postal service claims these moves will increase the efficiency of first-class mail. The delays in delivery times have been met with backlash. Many people are concerned these delays may impact people who pay their bills via snail mail. 

More Expensive Shipping 

No debt reduction plan would be complete without a few rate hikes. Additionally, the USPS has also implemented new price hikes. This includes a holiday shipping price increase, ranging up to $5 per package. This will affect any mail sent between October 3rd – December 25th for any shipments excluding letters and postcards. Additional price hikes were also implemented when shipping priority mail. We’re all watching to see if these changes have any impacts on Amazon, the eCommerce and shipping behemoth.

Weekly Swing Trades

PNRG (Prime Energy)

October 2, 2022

Entry Price:

80.62

Stop Price:

76.85

Target Price:

88.04

Time Frame:

1 Week Hold

Expecting a short-term bump after a recent OPEC+ announcement regarding the a supply constraint to oil. The constraint would result in ~1M less barrels of oil per day, which should cause a price jump. Low RSI and bouncing off our 250 day moving average, both hallmarks of a good swing trade.

DV (Doubleverify)

October 2, 2022

Entry Price:

27.75

Stop Price:

26.75

Target Price:

29.00

Time Frame:

3 Week Hold

Using our moving averages heavily on this swing trade, look for continued strength as we try to notch out a 6-8% gain. Specifically, we are taking advantage of of a recent cross over in the 50 day moving average. Last week closed down, so wait for confirmation of a reversal.

Amazon’s New Security Robot 

This week, Amazon held its annual product launch event. One of the biggest surprises from the entire event was the rollout of Amazon’s new autonomous household robot, known as the Astro. 

The Astro 

Amazon has big plans for their new little robot. The Astro has been dubbed “Alexa on wheels”. The bot is designed to learn your habits and make everyday activities easier. For example, the Astro uses intelligent motion to navigate and learn the layout of your home, thus avoiding furniture and even your pets. The robot can also follow you around playing music or podcasts. Like Alexa, the Astro can be used to make calls, send messages, and set alarms. It also has more advanced features like home security reporting, and the ability to assess your smoke detectors or listen for any unknown sounds in your home. 

The Astro is also being used for its facial recognition software in homes for the elderly, to recognize and provide status notifications for caregivers. It's no surprise Amazon is receiving backlash over potential privacy concerns! Amazon's latest invention seems to once again be pushing the boundaries of in-house surveillance. While this product is meant to enhance in-home security, concerns are growing the device may actually be seen as a threat. Shares of Amazon are down nearly 5% this week, since the product launch event. 

Volcano Crypto Mining 

In our 6/13/21 newsletter, we noted how El Salvador was moving forward with the revolutionary idea to formally make Bitcoin legal tender. While we’ve regularly reported on Chinese regulations related to the cryptocurrency, other countries are actually embracing the digital coin! This week, El Salvador helped fuel a 15% surge in the price of Bitcoin. We know Bitcoin mining requires an extensive amount of power to produce, El Salvador has explored more energy-efficient alternatives to mining crypto. This week, the country noted they were well on their way to successfully mining Bitcoins through the power on volcanoes located in their country! El Salvador explained they were able to successfully mine 0.00599 Bitcoin, for a value of about $269. Though this is only a fraction of complete Bitcoin, the news was seen as extremely positive. Environmental concerns have continuously been one of the bigger issues with widespread crypto acceptance. El Salvador also proclaimed they are hard at work to develop new mining tools. This news had #cleancrypto trending wide on twitter. Any advancements surrounding energy consumption for mining crypto should be viewed as a favorable tailwind for the crypto industry. 

Recent Winners: Swing Trading in Action 

On 8/29/21 we added Diamondback ($FANG) to our premium watchlist, and it was also highlighted in our newsletter. We noted this might be a longer hold but we liked the direction of the entire energy sector, specifically this oil and natural gas producing company. The energy sector has arguably been the hottest industry in the market, and as reported on 8/29, we don’t see that changing over the short term. With favorable market conditions in an industry poised to benefit from the great reopening, it only took 3 weeks to turn this into a big-time swing trade for our members. This 3-week hold translated to nearly a 20% gain for the Club! 

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Weekly Watchlists

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Weekly Review

Market Performance- Week of 09.25.2022

Recent Winners

SBUX (Starbucks)

SBUX (Starbucks)

Entry Price:

85.00

September 11, 2022

Price at High:

89.90

Return for Members:

5.76%

Timeline:

2 Month Hold

Strong momentum over the last few weeks. Watch for a mean reversion, but if moving averages stay consistent look for an early play to open the week.

PNRG (Prime Energy Resources)

PNRG (Prime Energy Resources)

Entry Price:

83.20

September 4, 2022

Price at High:

100.00

Return for Members:

20.19%

Timeline:

3 Week Hold

PNRG had a drawdown to historical levels of support (around the 100 day moving average). Looking to make an entry in the coming days as we also have macro tailwinds with the energy crisis in Europe.

PYPL (Paypal)

PYPL (Paypal)

Entry Price:

87.00

August 28, 2022

Price at High:

103.00

Return for Members:

18.39%

Timeline:

4 Week Hold

Playing off the dip in June, we're starting to see momentum as the 50MA is crossing over the long-term averages. Look to for momentum to continue and an early entry on Monday.

Recent Watchlist Winners

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