Final for Fin 6364,
Due date 7/24/2020
1. Please choose one of the following stocks for your final exam, first come first served:
Biogen (biib), Citi Group ( C ), Caterpillar (CAT), Celgene (Celg), Colgate Palmolive (CL), Capital One
(COF), CVS Health (CVS), Duke Energy (DUK), Emerson Electric (EMR), Exelon (EXC), International
Business Machine (IBM), Kinder Morgan (KMI), Coca Cola (KO), Monsanto (Mon), Merk & Co
(MRK), Qualcomm (QCOM), Simon Property (SPG), Target (TGT), Expedia Group (EXPE), Tesla
(TSLA), Mattel (MAT), Regeneron Pharmaceuticals (Regn), JD Com (JD), Mylan (MYL), American Airlines (AAL), Trip Advisors (TRIP), Abbot Labs (ABT), Allergen PLC (AGN), NIO, COP,BA, and American Express (AXP).
2. Choose only one stock from the above list and do the followings:
3. Is the short term (Daily chart) of your chosen stock strong buy, buy, hold, sell, strong sell? Why? (Based on technical principles)
4. Is the long term (Weekly chart) of your chosen stock above strong buy, buy, hold, sell, strong sell? Why? (Based on technical principles)
5. On a weekly chart, over the past 7 to 10 years, when one should have bought the stock that you have chosen? (Provide the dates and the reasons for each buy).
6. On a weekly chart, over the past 7 to 10 years, when one should have sold (go short) the stock that you have chosen? Provide the dates and the reasons for each sell)
7. There are 11 sectors in the S&P classification, namely: Energy, Materials, Industrials, Consumer Discretionary, Consumer Staple, Healthcare, Financial, Technology, Telecommunication, REIT, and Utilities. Provide one ETF for each of these 11 sectors.) Therefore, you need to name 11 ETFs, one for each sector.
8. To what sector does your chosen stock belong to? (One of the 11 sectors above). IS the long term (Weekly chart) picture of this sector (Sector in which your chosen stock belongs) positive or negative? Why?
9. Is overall market breath positive or negative? Why?
10. Provide 3-year daily candlestick chart of your chosen stock and show various candlestick signals on that chart.
11. Assume you are a fund manager using technical analysis and would like to beat the market (S&P 500, SPY). In order to beat the market, you decide to overweight 4 to 6 sectors that you think will do better than the market and underweight 4 to 6 sectors that you think will do worse than the market. Out of these 11 sectors, identify (Based on technical principles) 4-6 sectors to overweight and 4-6 sectors to underweight.
12. Choose one competitor of your chosen company. Based on technical principles, is your chosen company better buy than the competitor based on technical analysis?
Don't forget to include:
2. Price formation
3. Support / Resistance (Fibonacci)
5. Candlestick formation
6. Market Breath
8. Relative Strength
9. Overall recommendation on your stock.
10. There is no limit to number of pages.
11. Each question must be answered separately or on a separate chart. This means you have to have one chart to answer question 3 and another chart To answer Q4, and another to answer Q5 and so on ……….. Under each chart you write your comments.
12. Email me your PDF final by 7/24.
Guide for presentation: This was done (The chart below) last year, your chart should be current, containing prices up to August 1st, 2017 prices.
For questions 2 to 7, you need to provide a chart for each question. And under that chart you provide the rational of your answers. For example, I am following crude oil future and I will answer Q#6 as follow:
Question 6 asks when one should have SOLD (Not buy).
We should go short on points 1, 2 and 3. See below dates and rationales:
Point 1, 10/20/2008.
Rational. MA 50’s slope started downward and MA20 is below it. As long as slope of MA50 is negative I stay short.
Point 2, 4/25/2011: This is a weak sell for a very aggressive trader.
Rational: Looking at the indicators, RSI is giving a bearish divergence and other two giving me a sell. However, trend trumps indicator and trend was up (MA50 sloping upward and MA20 MA50). So, this point is for very aggressive trader and if one short here, one should get out ASA indicators give a buy signal. So, point 2 can be a sell but also one cannot go short given the trend.
Point 3, 9/8/2014: This is a strong sell
Rational: a) Break down of triangle top formation. (Note if it takes more than a few weeks for formation, then it is a reversal and not continuation). b) Triple top was not violated. C) Slope of MA50 turning negative. d) MA20 below MA50. e) MACD has given a sell signal few weeks before cross over of MAs.
Therefore, for each question of 2-12 you need a separate chart like this one.