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Swing Trade Idea – April 28, 2020

Market View

Ahead of the open markets are again higher with US futures rising at 5am. USD is lower, which is positive for markets. Bonds are flat so bond market does not agree with the stock market. Crude is very depressed in the front month contracts, which is bullish for tankers that are being used to store oil. General commodities are higher, either dead cat bounce or due to a lower USD. IMO the market is in a buy everything mode and happy to buy the worst companies i.e. dash for trash.  Should be positive for IWM and DIA.

Premarket names:

Same as Monday the premarket leaders are beaten down travel and leisure names such as MGM  CCL RCL; Virus related DGX MRNA;  Tankers FRO, NAT Cannabis CGC

Stock Idea: BBBY

Bed Bath and Beyond is a serial underperforming big box retailer losing out to Amazon. There is 54% short interest which provides rocket fuel to the upside. Monday there was a strong move up and high call volume. In the premarket BBBY is being bid up again along with companies like M and LB – all poor companies.  In current market setup, the worst companies are getting bid so BBBY fits the template.  The 50 SMA is 7 and above that, there is a volume by price gap with a 38.2 Fib at $8.19.  Risky, trashy company that may work with a dash for trash market.