What are the Best Stocks to Buy?
CYT Traders
May 19, 2021
What are the Best Stocks to Buy? Selecting stocks that outperform the market over both
The split tape I mentioned over the last few weeks continues as the Nasdaq and Small-Cap Russell 2000 hit fresh record highs while the S&P 500 and Dow Jones Industrial Average lag. The reason is simple: there remains a lot of uncertainty with respect to how this ongoing “trade war” that is brewing may unfold. The Dow and S&P 500 are more sensitive to these headlines while the Nasdaq and the R2k are less sensitive. Elsewhere, it was a big week for global central banks last week as they are all (slowly) moving away from the ultra-easy money era since the 2008 financial crisis. To be clear, they are still adopting an easy money stance, but the ultra-easy money period is now behind us (at least until the next recession or bear market).
Stocks ended slightly higher on Monday after the G-7 meeting ended and Trump headed to Singapore for the N. Korea Summit. Overnight, Trump and Kim signed a historic deal and the market barely moved. On Tuesday stocks were quiet as the world waited for a busy week from global Central Banks. Separately, Tesla said it will slash 9% of its workforce and Elon Musk acknowledged that the company will have to turn a profit “some day.” Stocks fell on Wednesday after the Federal Reserve raised rates and signaled two more rate hikes may happen later this year.
Stocks ended mixed on Thursday after the ECB slowly moved away from its ultra-easy money stance and President Trump signaled he may slap tariffs on China. By Friday’s open, $50 billion of tariffs were announced and now the world is waiting for China to respond. That concern largely dragged the market lower on Friday.
The small-cap Russell 2000 and Nasdaq both hit new highs which is bullish for the broader market. The other indices are acting well and still trading between important resistance (2018’s high) and important support (February’s low). Until either level is broken, I have to expect this sloppy, sideways action to continue. On the downside, the big level of support to watch is the 200 DMA line and then February’s low. For now, as long as those levels hold, the longer-term uptrend remains intact. Conversely, if those levels break, look out below. As always, keep your losses small and never argue with the tape.
What are the Best Stocks to Buy? Selecting stocks that outperform the market over both
Types of Trading Strategies for the Stock Market As a day trader, you buy and
What is Growth Investing? Investors use a variety of investment strategies to meet their short-term
Give us your email and we will give you the tools to change your life.
© ChartYourTrade | Contact us: website@chartyourtrade.com
Disclaimer: All communication from ChartYourTrade is general in nature and for educational and general informational purposes only. Under no circumstance should it be considered personalized investment advice. All our work is general in nature and not specific to any one person. All the information on this site and/or that originates from us, or any of our partners or affiliates, is for educational and informational purposes only and is NOT a recommendation to buy or sell anything. To avoid any conflicts of interest, we do not have a working relationship with any of the companies mentioned in our work. Furthermore, we may have a long, short, or no position in any, or all, of the names that appear in our work and they may change at any time without notice. Investing and trading in capital markets or using margin carries a high level of risk and may not be suitable for all investors. Leverage can work against you as well as for you. Before you decide to invest or trade in capital markets you should carefully consider your investment objectives, level of experience, and risk appetite, among other factors. The possibility exists that you could sustain a loss of some, all, or more of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with capital markets, investing/trading, and seek specific investment advice from an independent financial advisor and other professionals. Remember all the information we provide is for educational and general informational purposes only and is subject to change without notice.
Charts and Data are courtesy of MarketSmith Incorporated. Join MarketSmith here.