Today we are going to be talking about the top three Sling stocks for August 2019 Now I Do want to warn you going into this a lot, if not all of the stocks that I recommend end up not doing so well in the long run. That is because on this channel we focus on trading off short-term fluctuation, not randomly buying and holding. If you are looking to hold stocks for a long period of time. my suggestion is to learn proper valuation and investing techniques instead of trading skills.

But in any case, the only thing I ask of you in return for this video is that you hit that ravishing like button and also subscribe for more short, sweet and simplified videos on how to trade the stock market. Okay, so every time that I post they watch this video, someone will comment asking what broker I recommend trading these stocks on. My suggested broker is Weeble. They are a commission free broker and they have all of the tools that you need in order to succeed as a trader.

I Promoted them quite a bit on this channel I Have spoken about them a lot because they are an excellent broker to start trading these stocks on and you will get a free stock just for signing up with our link below. It's also a great way to support the channel. Okay, so to start, one of the biggest things that I look for when finding stocks to swing trade is finding stocks that are irrationally undervalued but also starting to recover. I Don't like seemingly undervalued stocks unless they are showing signs of recovering.

They need to be showing signs. And the reason is intuitive. If you were to adopt a random sick dog on the side of the road and adopted as a pet, there is a certain likelihood that that sick dog is going to recover. But there's also a likelihood that it may get worse and die.

So we want to look at stocks like we would look at sick dogs and only buy in when we see signs of a recovery. What are signs of a recovery, you might ask? Well, if we look at NX GN which also happens to be the first on our top Swing stocks list. If we look at it on the six-month chart, we can see that it got beat down like a winter gnome in the summertime. It was solidly trading above our directional strength That's um, a lion prior, but then broke its uptrend and fell below the upward direction.

and without knowing anything else and seeing this earnings icon, this certainly looks like a news catalyst event. And since every reaction in the stock market is an overreaction, the lows from this overreaction brought us a significantly emotional discount. But the key here is that it got beat down and was nationally undervalued. We are still trading way below previous support at just under $20 but we wouldn't want to buy in right at overreaction low simply because it could have just kept going down.

and there isn't really a way to determine whether or not we had reached the lowest point at that overreaction point. So the goal is to simply wait until we see signs of a recovery. We had a few green candlesticks and we saw it appreciate been price strength, which is hugely positive, but for this sort of play, we are going to need to look deeper to identify strengths since we are looking to swing trade this position but don't want to be stuck in it for more than a couple weeks. The ideal chart in the situation is likely going to be around the 20-day mark.

My role of time charts is to focus on the time chart that holds the maximum estimated duration of your position while using the other time charts for context. but NXG and this below fair value on the 20-day while also just starting to show signs of recovering with a conformation above our short-term blue SMA line. Well, what does that mean? Well, it means that after getting beaten down, we are just now showing an indication of actual strengthening of price strength. We had green candlesticks before, but they weren't strong enough to ignite over our blue SMA line and with a confirmation over the blue SMA line.

if all else is considered equal, we could simply buy in and write the price strength over the SMA line and sell out at validation. But as we know, all else is never considered equal when we're trading within the stock market. and there are other factors at play, we have elevating and deprecating factors. But with NX G N, I will be looking for not only price strength on our main time chart, but also a fulfilment of context.

A fulfilment of context Long-term What I mean by that is getting in at a discounted position on the smaller chart while also setting an expectation that while in the position, we provide confirmation over our blue SMA line long-term as well. It is very important to set clear expectations of your position, so if they don't do what you want, you can cut your losses or take your profits. And if this stock does fulfill our price strength requirement this month, we have aggressive upward potential from sixteen seven to twenty two dollars, which is like five dollars and thirty cents of upward potential. And our downward potential is from sixteen Seventy Two Overreaction Low 1468 which is roughly two dollars and two cents of downward potential.

So we have five dollars and 30 cents of upward potential to two dollars and two cents of downward potential. so these are good numbers. If we were being more conservative, we could set a more conservative estimate of upward potential towards just before the news catalysts affected the price action. In that situation, we would have upward potential from 2059, which is roughly upward potential of 389.

That's still a fair amount of upward potential. Okay, so now NSP is a top Loser today. Absolutely Love Top Losers. When it comes to the stock market, it is very important that you think of yourself as a schoolyard bully about to take the top losers lunch money.

If you understand this intuitively, you will be able to approach these positions with a winning mindset. I Love Top Losers. This discount to over sold and break of price break is a show of opportunity if we start seeing a reversal this month. But we simply cannot tell yet by looking at this chart whether or not this stock will attempt a reversal.

Remember my sick dog analogy? We know that this is a sick dog and a top loser, but we can't yet be convinced it is showing signs of recovering. And to understand the beat down, we should look for an explanation in the form of a catalyst. What is it that's driving this breakdown when we look into the potential catalyst? So you could simply Google search this. This isn't some sort of secret database that I'm using.

You could simply search this on Google and you can see that NSP provided poor guidance for the rest of the year. Very simple. That's our catalyst. Companies provide guidance or their own in-house predictions of revenue for future quarters.

And when companies provide a lower guidance than expected by analysts, this can often result in the catalyst. For a downtrend as we had here doesn't have to result in a catalyst for a downtrend. Sometimes it's the opposite way, but generally speaking, a negative guidance is obviously not a good sign for the company. And if it's lower than the analysts recommendations, that can often be a nightmare for the share price.

But in any case, we are going to be looking to see if this is indeed an overreaction. This is a stock that has a pattern of irrational gapping, but like the last news, Catalyst created overreaction highs. This is likely to create overreaction lows, but we can't be convinced of this until we see a confirmation. Always wait for confirmation folks.

A lot of people ask me, why do you spend so much time reminding me to wait for confirmation? The reason that confirmation is so important is because when you're planning your entry point, you're basically planning that your hypothesis is going to work. You form a hypothesis as to what the stock market is going to do, what your individual stock, how it's going to move, the behavior that it's going to show. But the stock market does not care how you feel about it. So you wait for confirmation.

Because confirmation is when you have the price strike over the SMA line. That is when your hypothesis is starting to turn true, and it also allows you to measure the price strength over the SMA line. But a lot of people don't like waiting for confirmation, and the reason is usually because they think they're going to be losing some of the move and you will be losing some of the move. But if you're so sure of your hypothesis that it's going to go up, why can't you just lose a little bit of your move? Do you have consistency in the long run? Okay, now AMD has been a solvent swing trade for quite some time.

When people think of swing trading, they often think of buying into stocks that are in a consistently up trending pattern, but are in what is known as a pushback from an uptrend. We like this because if a stock is consistently up trending, that means that it is more likely to continue up trending overall and that is a huge elevating factor pushing the price action in our favor. The analogy that I like to make with this is, let's say you have a bunch of people in a race. If you have a race with say, 20 people in it, the people in the lower half or the slower half have the ability to improve themselves and run faster Just as the ones in the top half might get worse.

They might end up going slower, but all else considered equal. The top runners are more likely to be top runners in future races as compared to the slower runners. Winners are more likely to keep winning then losers are likely to start winning. If you were to bet on a bunch of track runners, you would on average, be better off focusing on those who won previous races, not on those that keep losing race after race.

And that is why a stock that is consistently up trending overall is such an uptrending factor for us. When you buy one of these stocks, you are buying a winner and that helps boost the stock. And yes, it may fall from grace a lot of times they do. But if we can align our elevating factors, we can focus on creating winners that continue to win a majority of the time.

And with AMD a long-term winner, we have just found ourselves way below fair value. and with Andy we do have what seems to be the start of a push back. The question is how big this push back we'll be and whether or not we'll see it break into upper directional strength on our relevant time chart. Okay, last but not least, I do want to give an update on one of our favorite ETF pairs.

Gush and Drip continue to provide price action to trade off of. Ever since Gush broke our beautiful comeback pattern, we've had some serious appreciation on Drip. As you know, when Gush Goes Down Drip goes up. That's the nature of this beautiful ETF pair.

But what I found interesting is Drip has a pattern of rapidly over selling and failing to accept a directional change downward. We've had two push backs that came close to accepting a downtrend and then two areas that accepted a downtrend but then rejected it. What I'll be looking for in August is a push back towards oversold on Drip and a confirmation of price strength upwards. If we don't see that, we can flip the switch and trade gush and grab the upside there as grip false.

I would say the key is making sure to correctly identify a solvent upward direction on both and make sure to get in at a good deal. We always get in at a good deal folks. And for those of you who are wondering about Lab you and Lab D I Haven't seen what I'd consider to be ideal setups I haven't seen many ideal setups. It just isn't moving as much as I'd like.

When it comes to trading, you need to make sure that you are focusing on the best the best setups. They need to be shiny and they need to be clean in this market mostly. In the last couple weeks we have seen some seriously great setups, so there isn't really any reason to create stocks that provide little upside. But yes, Labview does have a history of over selling and returning to above fair value, so you could make an argument there.

I'm just saying it's not the best and I won't personally be focusing on this pair, but I will be keeping my eye on this biotech pair in August We may see some beautiful price action and it does have a long history of providing price action for us to trade off of. It just hasn't been in the last couple weeks to a few months anyways. I Do hope this video was useful if you have any questions for us. feel free to reach out in the comment section below or join our free zip trader circle Facebook group.

We also have a free discord chat and a trading tutorials playlist if you need any more assistance. If you'd like to see more short, sweet and simplified videos like this in the future, go ahead and hit that subscribe button. Have a great day folks and I'll see you in the next video.