While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to the six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
Today, I would like to make a suggestion on a stock that has been seriously oversold. That stock is Nautilus Group, Inc. (NLS).
NLS traded as high as $25 two years ago. It dropped to a low of $6.77 on January 18th.
NLS is trading under the lower band on the daily chart which gives you an idea of how oversold it is.
As I write this, it is getting a bid and is trading around $7.66.
The idea today is to buy NLS at the market.
Based on the nominal portfolio, I suggest you limit the buying to 600 shares which is about 4.6% of the portfolio.
NLS does have options, but only monthly options. But, I am not going to suggest you sell calls at the moment.
This is because they report on February 25th, so depending upon how NLS is trading, I may suggest you close the position ahead of earnings.
