Downtrend Protection v.2 vs. Valuation Model, $SKLZ +24.25% and $IEP +5.65%
A Comparative Analysis of Swing Trading Strategies: Downtrend Protection v.2 (Technical Analysis) vs Valuation Model (Fundamental Analysis)
Swing trading is a short-term trading strategy that investors use to capitalize on the up and down swings in the price of a security. There are two commonly utilized approaches to swing trading, and each approach uses a different type of analysis: Technical Analysis (TA) and Fundamental Analysis (FA). These methods of analysis present unique strategies for swing traders, and the way a trader implements them can significantly impact their investment performance. Today, we compare two such strategies - the Downtrend Protection v.2 (TA) and the Valuation Model (FA) using SKLZ and IEP as representative stocks.
The Downtrend Protection v.2 (TA) strategy focuses on identifying short-term downward trends in stock prices. This approach aims to protect a trader's portfolio from significant losses and has recently demonstrated strong performance with a gain of +24.25% for Skillz Inc. (SKLZ). This strategy relies heavily on technical indicators like moving averages, momentum oscillators, and support/resistance levels to make informed trading decisions. It aims to capitalize on price reversals from a downtrend to an uptrend, enabling traders to buy at relatively low prices and sell at higher ones.
On the other hand, the Valuation Model (FA) swing trading strategy employs fundamental analysis techniques to evaluate a company's intrinsic value. This approach analyzes factors like revenue growth, profit margins, and other financial metrics. In recent times, this strategy achieved a +5.65% gain for Icahn Enterprises LP (IEP). Traders using this model base their buy and sell decisions on a company's underlying financial health, betting that the market will eventually recognize the company's true value, leading to potential price appreciation.
Both strategies provide unique benefits. Downtrend Protection v.2 (TA) offers the advantage of protection during market downtrends and has demonstrated a substantial return with SKLZ. Conversely, the Valuation Model (FA) presents a slower but consistent growth trajectory, as exemplified by its performance with IEP.
Choosing between these strategies often comes down to an individual trader's tolerance, trading style, and understanding of the market. It's important to note that while these strategies can provide significant gains, they require a nuanced understanding of market trends and behaviors.
Momentum Indicator for SKLZ turns negative, indicating new downward trend
SKLZ saw its Momentum Indicator move below the 0 level on September 05, 2023. This is an indication that the stock could be shifting in to a new downward move. Traders may want to consider selling the stock or exploring put options. Tickeron's A.I.dvisor looked at 49 similar instances where the indicator turned negative. In of the 49 cases, the stock moved further down in the following days. The odds of a decline are at .
Technical Analysis (Indicators)
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for SKLZ turned negative on September 06, 2023. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 27 similar instances when the indicator turned negative. In of the 27 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where SKLZ declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for SKLZ entered a downward trend on September 27, 2023. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The RSI Indicator entered the oversold zone -- be on the watch for SKLZ's price rising or consolidating in the future. That's also the time to consider buying the stock or exploring call options.
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 16 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a +1 3-day Advance, the price is estimated to grow further. Considering data from situations where SKLZ advanced for three days, in of 174 cases, the price rose further within the following month. The odds of a continued upward trend are .
SKLZ may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.445) is normal, around the industry mean (19.799). P/E Ratio (0.000) is within average values for comparable stocks, (152.391). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (2.624). Dividend Yield (0.000) settles around the average of (0.088) among similar stocks. P/S Ratio (0.569) is also within normal values, averaging (74.443).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating slightly worse than average price growth. SKLZ’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. SKLZ’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 90, placing this stock worse than average.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a blank check company, which intends to effect a merger, capital stock exchange, asset acquisition, stock purchase, and reorganization
Industry PackagedSoftware
SKLZ and
Correlation & Price change
A.I.dvisor indicates that over the last year, SKLZ has been loosely correlated with COIN. These tickers have moved in lockstep 64% of the time. This A.I.-generated data suggests there is some statistical probability that if SKLZ jumps, then COIN could also see price increases.
| Ticker / NAME | Correlation To SKLZ | 1D Price Change % | ||
|---|---|---|---|---|
| SKLZ | 100% | -0.96% | ||
| COIN - SKLZ | 64% Loosely correlated | +5.09% | ||
| CLSK - SKLZ | 62% Loosely correlated | +4.32% | ||
| RIOT - SKLZ | 61% Loosely correlated | +4.55% | ||
| AFRM - SKLZ | 59% Loosely correlated | +2.91% | ||
| TDOC - SKLZ | 53% Loosely correlated | -1.80% | ||
More | ||||