SWBI: Locked and Loaded, heading higherSWBI has a very bullish setup. Wave 2 may need one more leg down sub-$11.50, but it is not required. Appears to be a very high probability double over the next 12 months.
Gunstocks
Do gun stocks benefit from the regulation debate?With every mass shooting incident in the US calls for stricter gun control legislation grow. But paradoxically, mass shootings also lead to a surge in purchases of firearms, as Americans arm up for their own safety and over concerns that certain types of guns may become harder to purchase in the future.
Stockpiling guns and gun stocks
As consumers stockpile firearms in the wake of shooting massacres, investors also pile into stocks of gun manufacturers.
On May 25, the share prices of gun manufacturers shot up after an armed 18-year-old stormed a public elementary school in Uvalde, Texas, shooting dead 19 children and two teachers.
Smith & Wesson (NASDAQ:SWBI) and Vista Outdoor (NYSE:VSTO) jumped 6.9%, Sturm Ruger (NYSE:RGR) rose 4.1%, while American Outdoor Brands (NASDAQ:AOUT) climbed 7% on that day.
Stocks of these companies have also risen since US President Joe Biden took office as tougher gun policies get more attention under Democratic administrations.
“The gun manufacturers have spent two decades aggressively marketing assault weapons which make them the most and largest profit… For God’s sake, we have to have the courage to stand up to the industry,” Biden said in a speech at the White House shortly after the Texas incident.
Loose regulations
Prior to the Uvalde shooting, Texas Republicans have repeatedly loosened curbs on gun sales in recent years, according to local daily The Texas Tribune. In 2021, lawmakers passed a law allowing people to carry handguns without permits, less than two years after mass shootings in El Paso and Odessa in which 30 were killed.
Gun debate drags on
Despite the number of mass shootings (and gun violence in general), Americans and lawmakers remain polarized over gun control laws. Senators recently noted that efforts to pass bipartisan legislation are making progress as Republicans appear to be more amenable to changing the laws.
A recent Reuters/Ipsos poll of 940 people conducted online has found that nearly two-thirds of Americans support moderate or strong curbs on gun ownership, including 53% of Republicans. The poll was conducted a day after the Uvalde shooting.
Controversial Trade Idea: $GWW sells metal detectorsI'll do my best to leave the politics out of this.
Mass shootings are in the spotlight again, and it would be obvious in hindsight to see a boost in demand and sales for security systems such as metal detectors.
NYSE:GWW , who just teamed up with The Mom Project, had $13 billion in sales in 2021 and is a leading distributor with operations in North America, Japan, and the UK. They also provide services like repair, maintenance, and other solutions.
$GWW is consolidated, allowing for both directional entry upon a breakout north or south (breakout levels $530 and $450, respectively). I will trade in the direction of the break with a bullish personal bias.
See products (security, metal detectors, scanners): www.grainger.com
If the Outdoors Advertising Is your cup of tea.I found this fancy looking cup and handle pattern waiting to form.
If outdoor advertising (aka Guns & Ammo) is your cup of tea its worth a second look.
Not Financial Advise. Just a 007
SWBI time to take profit?Per my last longer term SWBI chart (linked below), we are on the back side of a beautiful W. Targets for tomorrows price action are the intersections of the free-hand lines (green and red) with the channel lines (yellow). This one could go either way but is likely to be full of volume to the downside considering the recent 6 month run up in price.
Historically, when the government scares people with anti-gun talk, people buy guns and send speculative values in the stock market on a run. I personally think the fundamentals are different considering EVERYONE just bought 3 guns in 2020, along with all the ammo and reloading supplies the world had to offer. In short, there is no longer a crazy demand and the supply was already beaten down. If anything, the next stimulus gets kiboshed and everyone that bought their first gun in 2020 starts pawning what they have the least use for.
Pawnshops are about to have some badass inventory!
SWBI massive W with upside targets shown on chart99% of my portfolio is in on this one, call me biased. The real fun would be had in writing calls...
SWBItrading off the 10 & 20 EMAs, the daily is about to confirm the retest and signal an uptrend on the daily (green candle closing above the EMA cloud with the 10 over the 20) which could easily invalidate the idea published here: breaking down the right side of the blue "M".
If the "M" does play our as depicted, it will simply paint a larger "W" with an upside around $20, the resistance from our most recent major high.
SWBI SHORT TERMHolding the current trend on the 15 min chart, moving higher in the channel. Possible that the election cycle has more people hoping for a 2016 repeat in SWBI.
BE CAREFUL, Could very easily crumble back to $15.00 by the end of November for a retest of the 10&20 EMA from the daily chart, if the election cycle doesn't push the demand higher.
SMITH&WESSON ($SWBI) 🚨 | This Portnoy Pump is Locked and Loaded🔪 If you are a bear, the last thing you want is to be staring down the barrel of this Smith & Wesson chart especially after Warren Buffet's successor David Portnoy set his sites on it.
SWBI has been on an absolute beast of a run since the bottom as demand for firearms increased during COVID.
We have some clear support levels going into what should be a solid earnings report on June 18th. SWBI is locked, loaded, and ready for gains, we just need to pull the trigger as we target the next resistance.
Support:
We have tested this level already, we may see another test, or we may simply move up from here, both work well for the bulls.
If S1 can't hold, the bulls will need to see the S2 orderblock and S/R flip hold. Although this level could work, it also opens the bulls up to a potential move to the downside as illustrated on the chart.
Earnings is only two days away, losing momentum going into earnings may still result in a nice move for the bulls, but what bulls really want to see is the rally into earnings (as that gives them more flexibility to say close part of their position before earnings come out). Given this, S1 and S2 are the only logical targets for the timeframe.
Resistance:
In a perfect world, the bulls see a move off of S1 right into the R1 prior S/R flip before earnings. This simple and quick play offers about 14% profit.
If the bulls can make it past R1, perhaps on earnings strength, then the R2 orderblock is the next point of contention and is a logical place to look at closing positions after earnings.
Summary:
Nothing wrong with being long term bullish on SWBI, but for those who are just playing the Portnoy pump your ideal play here is a quick trade, in-and-out before earnings. For those a little more bullish, earnings is likely to be impressive and we could see R1 or R2 hit after depending on what happens leading up to the 18th.
What you don't want to do is try to be a hero and go bull below S2, riding the momentum makes sense, but being late to the party could mean ending up being bear food.
Resources:
www.earningswhispers.com + www.theguardian.com + www.fa-mag.com
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Blast Off! - Security & Self Defense PlayByrna Technologies, Inc. is engaged in the development, manufacture and sale of non-lethal ammunition.
It operates through the SDI and SDI Canada segments. It offers non-lethal weapons for military and law enforcement personnel.
The Byrna HD is not a firearm*, but is an incredibly powerful and effective self-defense weapon for men and women of all ages and abilities.
Folks, get in now because I have a feeling when this company gets uplifted to the NASDAQ, the stock will spike.
The weapon is made of high quality materials and works great, I own 3 of them.
If you like WRTC, you'll love this stock especially at the low price it's at now!
Read the company news releases. Sales are up over 1000% and they just paid off upwards of $6 million in debt.
They have millions of dollars in sales coming in and it's just the beginning!
Go to the website and watch the video. I haven't seen anything like it on the market.
Long!
$AOBC WEEKLYSmith and Wesson changed their name to American Outdoor Brands... looks like they poised for a bull run IMO... if you like guns
Good buying opportunity on SWHCSWHC climbed quite high in anticipation of a Clinton victory, primarily because gun sales surged as people anticipated a future with tighter gun control.
With that being said Trump is very 2nd amendment friendly, and long term could be great for this stock.
Another key thing to watch out for is an upcoming name change for the company. The companies new name would be "American Outdoor Brands Corp". While it will never have the ring to it like Smith and Wesson will, this name would reflect the companies holdings outside of firearms and could suite the company well.
I'll be watching this stock for a bit. Might go down a bit more this week, but I see a lot of potential here.
