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The Next Market Leaders - 3/30
Markets have continued driving up in what looks like a classic lockout rally, in which many market participants, engrossed by the flurry of bad news, underestimate the market turnaround and have to increase their exposure (or cover short positions) quickly. It has makes the market look extended and doesn’t provide too many solid entries. Fight FOMO in this environment or you’ll get smacked like Chris Rock.
Today, markets closed down around 1% but futures are pointing higher tonight. A few more days of controlled consolidation would be best, but watch out for accelerated selling or wild moves as a bearish sign. How the current leaders like TSLA and NVDA act will also provide insight into how healthy the pullback is and if it’s okay to continue buying. Individual stock setups are always the best market barometer.
Tonight, I’ll dive into many such stocks as well as the ones that are on the top of my focus list for the rest of the week. Let’s get into it!
The Nasdaq headed straight up close to its 200-day moving average, faster than I thought it would, and today traded down a bit for some consolidation. Rest is normal here after a huge move from the bottom and has the look of a “lockout rally”.
The S&P-500 continued up after testing its 200-day moving average last week. As with the Nasdaq, I’m looking for some consolidation here so that the other key MAs can catch up and set up for a more sustainable move higher.
Broadcom (AVGO) is up 3% from my buy point with stops at $605. I’ll consider adding if it retests and holds $615.
Juniper Networks (JNPR) is now 6% higher from my average buy price of $35.50 after two buys and I took a bit of profit off today. Stops are up to even at $35.50.
Cleveland-Cliffs (CLF) is up 16% from my $28 buy point and now is consolidating a bit. Take profits if you haven’t yet on a portion and move stops up to $29 on the rest.
NVIDIA (NVDA) is up just 2% from my $270 buy point. It might test $270 so I’m keeping stops at $261, though I’d sell sooner if the indexes are selling off. Otherwise, I’d add on a test and hold of $270.
Tesla (TSLA) gapped up from the bull flag buy point on Monday which made it difficult to catch. I’m watching this one for another proper entry to develop.
On Semiconductor (ON) traded up through the buy point at $64 on good volume and was up as much as 8% yesterday before selling off today close to the buy point. Move stops up to even if you haven’t stopped out yet.
Bumble (BMBL) has been in a steady downtrend since its IPO, but traded on its highest volume ever a few weeks ago and is now flagging above the 50-day MA with the price tightening. $30 is a pivotal point so I’d consider buying on a move through it on heavy volume with stops $1 lower.
Allegheny Technologies (ATI) is a metals manufacturer that’s been on a big run since early February. Yesterday, it held the 21-day MA which could’ve been a spot to start a position. The breakout buy point is a move above $28.50 with stops $1 lower.
Costamare (CMRE) is a shipping stock with stellar earnings growth that broke out of a cup pattern two weeks ago and now is consolidating just above it. Volume is really coming into the stock which is a sign of institutional accumulation. The first buy point is a move through the high-volume close area at $17.70 and then add at the $18 breakout. Look at this pretty weekly chart:
Snap (SNAP) is a candidate for a quick trade as it printed its highest-volume-ever a few weeks ago on a solid earnings report. If it trades up through the close of the high volume bar, it can be bought with tight stops, but only if supported by good volume.
BRC (BRCC) is a new issue that’s exhibiting an IPO U-Turn pattern and has two days in a row of relative strength new highs. Today it traded on an inside-day. The buy points are as follows: through $25.25, add above $21 and $23 (if heavy volume). Stops at $19.65 on the first buy.
Vacasa (VCSA) is a newer issue that is flagging just above the highest volume since IPO bar. I’d consider buying this stock on a move through $9 with tight stops $0.25 lower. A move up through $9.35 on heavy volume is a big buy with stops just below $9.
That’s all for tonight! If you liked this column or have any feedback about the content, hit me up on Twitter with the link below or respond to this email.
See you back here on Sunday night for an update on our stocks.