“Jay, I would like to learn trading from you.” a prospective student approached me.
“Why do you want to learn about the stock market?” I asked.
“I would like to trade the stock market full-time to enjoy the time freedom and flexibility.” he replied.
“That’s great! Are you willing to put in the hours to understand the behavior of the stock market, and the mindset required before…”
Before I could complete my sentence, I got cut off.
This prospect desired a get-rich-quick scheme instead of building a firm foundation before learning about the strategies.
While the stock market can bring riches, it usually results from good old hard work and mindset.
And I think this week’s stock pick will likely explode in price.
But before I share my game plan, let’s review last week’s stock pick- Deckers Outdoor (DECK).
Review Of Last Week’s Pick Of The Week
Deckers Outdoor was last week’s stock pick.
Being a seller of sports apparel and accessories, it belongs to the Consumer Discretionary sector.
A key price level (aka support) was identified at around $198, and that’s where I was waiting for its share price to drop before rising.
This price action played out according to the plan.
As its share price continues to rise, I foresee a potential resistance area that could serve as profit-taking level.
You can find this price level in my Telegram Channel.
Shall we now discover why Royal Caribbean is my stock pick of the week?
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Why Is Swing Trading Royal Caribbean (RCL) Worth It?
Source: royalcaribbeangroup.com/brands
Royal Caribbean is a cruiseliner that belongs to the Consumer Discretionary sector.
As soon as summer began, its share price rose progressively, signaling a vote of confidence by the market.
In the last 3 months, its shares have sailed northwards (pun intended) by almost 46%, while the S&P 500 has only risen by 7.5%.
With a 6x outperformance and consistent explosive price movements, it’s a stock worthy of your attention.
And here’s the best part – a pullback is here, signifying that an opportunity to catch its next explosive upmove could be here.
Which price area am I waiting for?
Continue reading to get the details.
P.S. What if I told you that you could drastically gain control over your emotions of fear and greed, and master the stock market in a short amount of time?
My team and I have worked tirelessly to help you achieve results fast.
Click on the banner below to claim your stock course for free (limited time) now!
Performance Of US Stock Market vs Royal Caribbean (RCL)
Let’s begin by identifying the price trend of Royal Caribbean’s shares.
From the chart above, you can tell that its share price is in a steady uptrend. Because following the trend helps to increase your chances of profiting from the stock market, you’ll want to be in search of a buying opportunity.
Next, you’ll want to know whether Royal Caribbean’s share performance has consistently beaten the S&P 500 so that you can increase your chances of making an outsized return.
So, let’s refer to the comparison chart above.
In the past 3 months, the S&P 500 had risen by 7.5%.
In contrast, the share price of Royal Caribbean had risen by almost 46%! That’s a stunning 6x outperformance!
Royal Caribbean’s shares have been making a splash and deserve a deeper look.
How Explosive Is Royal Caribbean (RCL)?
Things get more exciting here.
Referring to the chart above, you can see that Royal Caribbean’s shares have a distinct characteristic: they consistently explode in price.
In just the last 11 months, its share price has exploded upwards 20 times!
Its smallest upmove measures 5%, while its largest measures 19.9%. That’s wild for a listed company with a $65b market capitalization!
Knowing that the company enjoys a massive market capitalization adds a layer of security because its shares will be less susceptible to manipulation.
Are you ready to find out whether I think it’s a good time to buy its shares for an explosive swing trade?
Key Price Levels
Let’s uncover the key price levels (aka support and resistance) to discover whether the time to buy its shares for an explosive swing trade is ripe.
Did you spot this support area at around $242?
Here’s my game plan.
Because that’s a support area, I think Royal Caribbean’s share price could continue to pull back to around $242 before exploding upwards.
Therefore, I will keep a close watch at $242 before buying its shares for an explosive swing trade.
Here’s a pro tip: Instead of staring at your screen, you may want to set a price alert on your broker’s platform to be notified so that you can spend precious time with your loved ones.
Which Instrument Should You Consider Using?
Do you ever wonder about the instrument used to trade explosive stocks?
With 3 main trading instruments available – stocks, contract-for-difference (CFD), and options, you wonder which suits you best.
Since stocks (as an instrument) is easy to understand, I shall focus on CFD and options.
Here are the main similarities and differences:
CFD works like a mirror to stocks. When a stock rises $1, its CFD rises $1.
However, due to its unique pricing mechanism, your options price doesn’t rise by the same amount. In fact, depending on the market conditions, the price of your options contract may even drop!
Your CFD broker will charge you a finance fee for lending you money for your trade. However, no lending is required for options, so there is no finance charge.
Because there’s a finance charge by your CFD broker, CFD is not the ideal instrument for mid to long-term trades. On the other hand, options allow you to implement different strategies across time horizons.
Both CFDs and options are leveraged instruments because they allow you to control a larger market position with a smaller amount of capital.
While CFDs do not have an expiration date, options traders must pay attention to the expiration date of their options contracts.
You must be thinking, “What’s the beauty of trading options?”
Options are like smartphones. You can choose to use a smartphone for its basic or advanced functions.
And options don’t have to be all about Math and dry!
It can be made easy to understand through real-life analogies.
In the same way, you can implement basic and/or highly advanced strategies depending on your level of comfort.
Options allow you to be versatile in adapting to the shifting market conditions and capturing opportunities in the process.
Are you a CFD or options trader?
I’m glad to be fluent in both.
Finally, this is for educational purposes. Please perform your due diligence.
All images are taken from pexels.com, pixabay.com, sectorspdrs.com, tradingview.com, and unsplash.com, unless otherwise mentioned.
Claim Your Free (Limited Time) Stock Course Right Now:
The stock market is full of traps laid out by professional traders.
Many new traders are often left confused by conflicting signs and signals.
Worse still, ~80% of traders lose money.
This is because trading isn’t just about skill alone.
It includes the mastery of your emotions.
But what if I told you that you could quickly gain control over your emotions of fear and greed and master the stock market?
My team and I have worked tirelessly to help you achieve results fast.
Click on the banner below to claim your stock course for free (limited time) now!
