RRD daytrade for 3/28/2017

Posted By MookTrader on Mar 28, 2017 | 0 comments

We are always on the lookout for overly beaten down stocks with daily charts resembling rocks falling off a cliff. Sometimes they make prime picks for bottom picking, assuming the only reason they are going down is because a huge fund is just liquidating its stake. An example of this is the stock $RRD (RR Donnelley & Sons). It has been trending down since its February 28th decent earnings release and in-line forward guidance forecast, where it closed at $16.55 that day.

One month later, $RRD stock hit a low of $11.02 today -- that's a -33% decline on no concrete news. We speculate that funds are blowing out of this thinly traded stock and ignoring the cheap valuation the stock is now trading it. Either something is wrong with the company that news hasn't been publicized yet or it's just a screaming buy. We are thinking the latter and decided to buy some for a bounce today.

We entered the $RRD long position at $11.09 today and added into strength when the tape showed that buyers were ticking the stock up (and the massive sellers were not grinding it down). We did not see a huge block print (something around 300,000+ shares would have been nice) near the bottom of the lows today so decided not to swing long the position and just daytrade it. Took profits into strength and ended up with a nice and easy stress-free trade.

Net Profit: +$3,344

All trades are called out live in the MookTrader stock chatroom as they happen. Come trade with us!

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