Here’s how to hit the bulls eye on $VSTO – May 3, 2021


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I want to look at Vista Outdoor ( NYSE: VSTO ) and here’s why; technically this stock is squeezing. It is really pretty tight here. They also report earnings on Thursday, they report them Thursday morning so there are just 2 trading days to go before earnings are released.

If you look at their website you will see they have a pretty good, I don’t know what you call it, shooting sport or whatever, department, they sell a lot of ammo. A while back, I think it was in 2019, they got rid of their gun stuff so they don’t do guns anymore. That makes it for people that are all about gun control. Fine, whatever works for you, I don’t have an opinion on that.

This is a stock that you could consider unless you are so pure that you don’t want any ammo manufacturer either because this is a lot of their business. I don’t have a problem with that and so I am just looking at this chart, again, they report after another 2 trading days. Trading volume on this has been lower than average now. But what happens if I shift from the 50-day moving average to 20-day moving average over the last month?

You will see the stock has been in a trading range here really for about the last 20 bars. And so over the last 20-days, as far as the average volume, which is the red line here, the last 2-days have actually been above average. I’ve got a bigger bar on Friday but then today we also got a high volume but the stock closed near the high of the day; less than 1 percent below the high of the day, which means it had a pretty good close, this is how the stock traded during the day.

I like this stock right here, I took a position today. I don’t know what I am going to do as far as if I am going to sell it all before earnings, it kind of depends on what happens the next couple of trading days. But I do know this, ammunition, just go to any website and try to find ammo and you will say, oh, they have got a lot of it for sale, what are you talking about? Then look just to the right of the sale price, where you could say buy here, just to the right in red font it says out of stock. You see that for virtually any caliber of ammo; everybody is out of stock.

Now, I don’t know which way this cuts for Vista Outdoor ( NYSE: VSTO ) because even if there is a huge demand you don’t get paid unless you can actually sell it. So again, I don’t know whether this huge demand is going to result in some monster earnings for Vista ( NYSE: VSTO ).

But I will say this, if it doesn’t then you can bet that Vista’s ( NYSE: VSTO ) guidance will be off the charts good. Because there is an expectation, among those who care, that the ammo situation, the shortage, will start to be remediated this summer, there will be some additional supply etcetera, etcetera. I am not talking about that, I am just talking about the stock, trying to analyze it from kind of a common sense perspective along with the charts.

I would, and I did buy it here on this breakout. And then from here, you have got to give it about 6 percent for the next couple of days. If it closes down below the 50-day moving average I am certainly not going to want to be long, particularly going into earnings. Now, if it is up 6 percent then that might be a better deal. That is how I would trade this, that’s how I am trading this.

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