Weekly Update: Welcome to the ChopFest
Welcome to the ChopFest.
After a strong move higher in the last half of March, stocks have struggled to make any meaningful progress over the last two weeks.
Up a percent one day. Down a percent the next.
Frankly, the market feels like it is asleep.
As you can see in the chart above, volume has dried up significantly. Bulls and bears alike are waiting to see if their positions play out and likely growing frustrated.
In the March 31 Stealth Trades Weekly Update, I shared my target for this rally – 420-430 in the SPY.
As of today, the high of this move is 415. So, I expect the indexes to run a few percent higher before we see any meaningful pullback.
Here are a few stocks I am watching right now:
Hims & Hers (HIMS)
HIMS is an exciting new company taking the awkward discomfort out of sensitive medical issues for men and women.
They have two sites – Hims and Hers.
The sites are catered to each gender and offer hair loss medications, prescription skin cream, anxiety drugs, and sexual dysfunction treatments via quick, online doctor visits. The company then ships the drugs or product directly to the customer’s home.
The company went public three years ago, and it has been a roller coaster ride for investors.
Shares have been as high as $25 and as low as $3, all in just the last couple years.
But the stock is showing signs of a new breakout higher.
The 10, 21, and 50-day moving averages are stacked tightly below the stock to form a launchpad setup. We have also seen price consolidate nicely over the last six weeks as investors digest the blowout earnings numbers.
I bought some on Thursday near $10 per share. The stock needs to stay above $9.35, or I will consider getting out.
On Holding (ONON)
ONON is the maker of the popular OnCloud running shoes.
The company has experienced tremendous growth over the last few years. I even see it here. They are on the feet of every soccer mom in town.
Last month’s earnings report blew away expectations and shares advanced almost 50% in a week.
Since then, pullbacks have been minimal.
This is a recent IPO, and it is quickly becoming a true market leader.
I am writing this at noon on Friday, and the stock is currently trading near $31. I believe the stock is buyable here with a stop loss at 28.20 to risk 8% on the trade.
Exact Sciences (EXAS)
Exact Sciences is a biotech stock showing high relative strength.
Following a 50% jump in January, the stock is tightening with pullbacks getting shallower from left to right.
This is a sign of seller digestion which we often see before a new breakout to the upside.
EXAS is also finding support at key moving averages which appear to be holding up the stock.
I would consider buying on a breakout above $69.
Best wishes for your trading,
Ross Givens