We’re on a quick trip with the kiddos ahead of the long weekend, and I suspect many of you are more than willing to bury the first half of the year and plan for any upcoming BBQs and cocktails, so we’ll keep this week’s Movers & Shakers on the short side. Have a great long weekend, and we’ll be back with you on Tuesday (July 5) for the next Top Ten issue.
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It’s been a down week thus far for the market with most major indexes down in the 2% to 4% range coming into Friday. Really, nothing has changed from what we wrote last week—the intermediate-term trends are still down for the indexes, for growth funds and for the vast majority of stocks and sectors. Thus, we’re again sticking with our defensive stance.That said, we’re also still seeing a bit of resilience among some of the beaten-down growth areas, and we’re still seeing more stocks building bottoms in recent weeks and months. It’s not overwhelming, but we’d just say a good week or two from here would present an interesting situation. Still, as always, you have to see it first to believe it, so we’d continue to hold plenty of cash and go slow on any buying until the bulls really show up.
Probably our biggest piece of advice as we plow into Independence Day, though, is to remain flexible and listen to whatever the evidence says—six months ago, people’s minds were hardened that the economy was good, that stocks wouldn’t fall a lot and that inflation was transitory … all of which proved wrong. Instead, watching the market and the action of leading stocks helped keep us generally defensive.
Today, of course, people’s leanings are in the opposite direction, with the bear market and recession on everyone’s mind and most expecting lower prices. We offer no predictions except to say that, when the bulls do return, it’s nearly a sure thing that the masses won’t be pointing it out—they’ll be telling you it’s just another false rally.
What we’re really trying to say is simply: Listen to what the market says, not to what the pundits or masses are saying. It will do the best job of keeping you safe for as long as the sellers remain in control while also speaking up when the trend turns up. Right now, that means playing defense; our Market Monitor remains at a level 3.
SUGGESTED BUYS:
Like many biotech names, Alkermes (ALKS) has been holding well in recent months and has pushed nicely higher from its June lows. You could nibble here, though we’re also intrigued with a small buy on a push above 31 (above some resistance) and a stop in the 27.5 area.
Scorpio Tankers (STNG) has remained very resilient despite a massive run of late—yes, it could eventually hit an air pocket, but the 50-day line (now nearing 31) is catching up quick. You can consider nibbling here or any dips, with a stop near the 50-day line.
SUGGESTED SELLS:
Jabil (JBL) – tripped stop
SUGGESTED STOPS
Dollar Tree (DLTR)
near 146.5
Funko (FNKO) near 21
HealthEquity (HQY) near 58.5
Nexstar Media (NXST) near 157
Nordstrom’s (JWN) near 20.5