The Anatomy of a Winning Idea (DLTR)
Jan 19th, 2009 | By Charles Delvalle | Category: Chart of the DayWhen you rely upon charts to help you time buy and sell signals, you shouldn’t strictly look at the charts. You should also have an idea as to where you think the economy is heading so you can be sure to play the strongest trends. Here’s one idea I had which has played out phenomenally…
Most analysts feel the economy is heading south. As credit tightens and people lose their jobs, they’ll look to maximize every dollar they have. That means that businesses catering to “lower cost” consumers should do very well.
One business – which most people hate and even laugh at – is a company known as The Dollar Tree (NASDAQ:DLTR).
But take a look at how DLTR did throughout 2008…
As you can see, while every other brick and mortar retailer has been slammed (and even gone bankrupt) this year, DLTR managed to climb nearly 100%.
Making things even nicer, as consumer spending plummets, DLTR continues to move higher still.
You see, had you simply relied on technical analysis, you may have been tempted to not buy DLTR early last year. But if you have a solid idea as to which economic trends will prevail, then you can use that knowledge to pick the stock… and technical analysis to fine tune your entry and exit points.
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Charles Delvalle is a self-taught market-timing professional and value analyst who's followed and invested in the market for the past ten years. He uses a unique combination of technical and fundamental research to pinpoint rapid profit opportunities with stocks and options.
Charles is also a staunch contrarian and takes pride in finding undervalued sectors and discovering undervalued, cash-rich companies. He frequently mocks government stupidities and points out the "inaccuracies (or lies, take your pick) that government reporting frequently dispels as "truth".
