We normally do not trade the restaurant sector but the leverage and upside of BLMN could not be ignored. Please refer to the public blog for some background on BLMN if interested. On a corporate front, today, the CEO of BLMN was one of a handful of restaurant CEO’s to meet with President Trump at his Economic Council on re-opening the country. Also, days ago BLMN announced a strategic change to its business model by incorporating a fast-casual dining experience called The Aussie Grill. This will be a stand-alone concept and store add-on to their current platforms. The first two are opening in Florida this month catering to the fast-casual diner at a lower price point. They announced plans to increase their current expansion into South America in 2020. Both of these are excellent developments in this post-pandemic world. Price swings will be large until America opens back up. Although we forecast possible weakness in the stock market into next week, it's possible BLMN bucks the trend as it opens many of its 1000 chain locations in largely unaffected states. According to the President at Tuesday's press briefing he indicated half the country is ready to open up yesterday! Luckily the BLMN platform is spread across the globe and not just in CA, NY, NJ, CT, MI, and IL. Once we break $10 we expect a quick multi-day move to 12.50-13.50. Remember, Wall Street is forward looking. Expect price to move before the headlines.
The Dow is shown above. We expect choppy congestion for the next 7-8 days, not conducive for a large trending trade at the time. Sentiment needs to cool off as noted in our SPX Optix chart. We remain on the sidelines for the share market. However, our AI model is showing a huge move from late April into Mid-May. Please be ready!
Gold is too high to trade now and not low enough for a lower risk entry. Our models anticipate a pullback and strong trending trade in May. Be patient - 1800 is a brick wall currently.
Oil is holding its Oil-War low set weeks ago. A move upward as forecasted into late April should materialize. However, there are too many risky geopolitical events that may occur to take positions now.
We will address Bitcoin in tomorrow's report. We have had many requests for a forecast by our Gold Members. We will also address our economic outlook in more detail tomorrow.
HFZ