The stock market is having a big gap up this morning following the Trump/Xi trade war truce announced this weekend. Trump said he won’t increase the tariffs for another 90 days. However, the stock market turned actually turned up last week and now everyone is ready to trade. There is nothing like a move up in the stock market to get people excited about the stock market.
However, I am not as bullish as most people and do not think the best stocks to buy are the popular past fad stocks.
At 10:00 AM EST I’m going to do a live stock trading session in which I will show how I use one of my favorite technical analysis indicators for trading entry points and some new stocks I’m adding to my own personal watchlist.
So go here for the session:
I’m not into just buying past fad stocks that are bouncing and still below their 200-day moving averages.
So here are three stocks to watch this week that are positioned to be leader stocks.
The first is SMTX.
SMTX is a Nasdaq stock that has been going up while the Nasdaq has been going down the past few weeks.
It’s now consolidating and pausing. If it can consolidate here below $4.00 and breakout again look for it to really surge into the end of the year.
The next stock to watch is FNSR.
FNSR simply has soared and is now above its September high.
It needs to pause and consolidate for a few weeks here though to provide an entry point. I’m simply not into chasing stocks and do not recommend you chase either no matter what people on TV may tell you to do.
I’m just not in the game of finding what popular stock has gone up the most in a day and yelling buy on TV in the evening for ratings.
Now here is the most interesting stock of the three today.
Since the market peak in September the top performing sectors in the market have been defensive sectors such as utilities and that remained the case last week too when the stock market went up.
SCG is utility company based in South Carolina paying a 1.00% dividend.
It came out of a stage one base in November.
Once it pauses here for a few weeks it will provide a good safe entry point.
The difference between a stock like this and something like FB is that it just came out of a stage one base so is in a position to potentially go up for years just starting a stage two bull market whereas FB made a major top months ago and is merely bouncing in a nasty stage four bear decline.
SCG is also in what has been one of the top performing sectors of the market in the past two markets.
Sector leadership has shifted out of big cap tech and into defensive sectors.
Yes tech is going to gap up this morning, but overall there is still a big money shift happening.
Anyone who owns FB would do better to sell their FB stock and buy SCG with the money.
Now in today’s video session I’m going to talk about the indicator I use to buy on dips and also bet against junk stocks on bounces.
We’ll start at 10:00 AM EST (recording will be available on the page afterwards in case you can’t make it at 10:00 AM):
-Mike
