Biden’s $2.5 trillion infrastructure plan was televised after the market close on Wednesday evening, with far reaching implications for the electric vehicle market. Benefits should extend to EV companies like Tesla (TSLA), General Motors (GM), and Ford (F). Charging station operators ChargePoint (CHPT) and Blink Charging (BLNK), among others in these industry groups stand to benefit as well.
Summary
An additional catalyst should emerge from April’s above average (+14.48%) seasonality prospects (see below). This time of year analysts meet with companies looking for industry groups that will outperform, like beaten down tech related stocks. We’re watching for activity stemming from this catalyst so stay tuned.
Tesla (TSLA)
EV leaders Nio, Xpeng and Tesla stock are set to jump at the open, while Boeing and Microsoft are at buy zones. We’ll add to our Tesla position today if price ac tion continues its current path.
Wednesday saw price action close above the 21d moving average. The 50d (739.93 +/-) appears to be the next target. Stochastic, MACD and RSI are bullish. Volume is beginning to show signs of more institutional buying activity.
Biden offered his plan as a “once-in-a-generation” opportunity, outlining key points which included massive funding for bridges, roads and water projects, as well as money for expanding broadband access and domestic chip production. We’ll focus on these areas.
A corporate tax hike to 28% from the current 21% would pay for the package long term.
Biden plans further spending increases funded by taxes on high earners and capital gains.
Stochastic MACD Scan
These candidates exhibit bullish price action, with Stochastic oversold and turning bullish. MACD is crossing or about to cross, with RSI rising through or about to rise through 50. Volume needs to be above average.
| SYMBOL | NAME | SECTOR | CLOSE | CHG | % CHG | VOLUME |
|---|---|---|---|---|---|---|
| CHPT | CHPT – ChargePoint Holdings, Inc. | Discretionary | 26.70 | 4.24 | 18.88 | 18385169 |
| GRWG | GRWG – GrowGeneration Corp. | Discretionary | 49.69 | 5.35 | 12.07 | 3400462 |
| CSTL | CSTL – Castle Biosciences Inc. | Health Care | 68.46 | 6.28 | 10.10 | 665641 |
| NARI | NARI – Inari Medical Inc. | Health Care | 107.00 | 6.03 | 5.97 | 746081 |
| ALLO | ALLO – Allogene Therapeutics, Inc. | Health Care | 35.30 | 1.87 | 5.59 | 497871 |
| RVMD | RVMD – Revolution Medicines Inc | Health Care | 45.88 | 1.95 | 4.44 | 417442 |
| BHC | BHC – Bausch Health Cos. Inc. | Health Care | 31.74 | 0.70 | 2.26 | 2631260 |
| BSAC | BSAC – Banco Santiago | Financial | 24.83 | 0.22 | 0.89 | 969798 |
Chargepoint Holdings (CHPT)
ChargePoint (CHPT) forecast stronger revenue this year on March 11, in its first report since going public through a SPAC merger on March 1, while rival Blink Charging (BLNK) won a key grant from Ohio state as it looks to expand.
Outlook: Q1 revenue of $35 million-$40 million and full-year revenue of $195 million-$205 million, a gain of 36.5% at the midpoint vs. last year.
Chargepoint Holdings (CHPT) gapped higher on Wednesday on 4 times normal volume. RSI is rising.
Price action closed above the 21d moving average.
RSI is rising, MACD is above its signal line and stochastic is rising, the latter suggesting closes in the upper half of the daily range.
In September, the company said revenue grew 60% year over year in 2019 to $147 million. But it had a net loss of $133 million, due to expansion costs. At the time, ChargePoint said 2020 revenue was expected to dip as the pandemic slowed EV sales but projected 60% compound annual growth from 2021 to 2026.
Founded in 2007, ChargePoint’s backers and EV partners include investment manager Baillie Gifford, Volkswagen (VWAGY) and BMW (BMWYY).
These trades should be considered as short-term in nature, due to recent market weakness.
Futures are bullish this morning, Dealers will buy back shares as their short puts lose value. This could start a rally.
Join us today in the trading room for our LIVESTREAM broadcast during market hours, as we navigate the current environment. Watch, listen, and trade from 9:20 AM to 4:15 PM Monday through Friday.
Happy Trading,
Vinny
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