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Current Market Outlook


First off, a heads up that our offices will be closed on Friday for Good Friday. So we’ll probably be sending you Movers & Shakers a day early this week.

As for the market, the split environment continues, with many major indexes closing last week near new highs, while the Nasdaq is still languishing beneath its 50-day line. Overall, the song remains mostly the same—growth stocks are mired in a correction (including some big winners from last year that can’t get out of their own way), and while many cyclical-related stocks are holding up well, few are really making much upward progress. There are some pullback opportunities here and there, and to be fair, we are seeing more potential setups in growth land. But at the moment, the market action resembles a kid scribbling on a piece of paper, with jerky movements that don’t persist. Thus, we continue to think you should mostly play it safe, keeping new positions small and holding a generous amount of cash until we see the next sustained uptrend get underway.

This week’s list is mostly turnaround-based, with some strong travel and retail stocks that could be decent entries on dips. Our Top Pick is Urban Outfitters (URBN), which staged a longer-term breakout a month ago, with this first pullback likely buyable.

Stock Name	Price	Buy Range	Loss Limit
Alaska Air Group (ALK)	68	64.5-67.5	57.5-59.5
Alliance Data Systems (ADS)	113	105-110	93-95.5
Callon Petroleum (CPE)	37	33-35	26-28
Expedia Group (EXPE)	177	167-173	149-153
Nexstar Media Group (NXST)	139	135-140	123-126
RH Inc. (RH)	566	545-560	490-500
SeaWorld Entertainment Inc. (SEAS)	49	45-47	40-41
Urban Outfitters (URBN)	37	35-37	31.5-32.5
Wayfair (W)	335	325-340	294-302
ZoomInfo (ZI)	49	48-50.5	44-45

In our view, the market still has a good amount of work to do, including when it comes to the intermediate-term trend of the major indexes, the trend of growth funds and for individual stocks, where breakouts to this point remain few and far between. Still, there’s also no question that, after weeks of bottom building, the evidence has certainly improved, with very solid action during the past two weeks among a variety of issues. We’re encouraged, but from here, it’s simply a matter of believing what we see. For now, we continue to favor holding some cash, buying on dips and keeping positions on the small side.


This week’s list is a mix of strong commodity names and some chip and growth titles that have perked up. Our Top Pick is a mid-cap energy name that should thrive in the quarters to come.

If you dug into any financial news this weekend, you were likely inundated by tons of bearishness that have arisen due to so many uncertainties, but when it comes to the market, it’s best to just keep it simple and focus on the action itself: The intermediate-term trend of the indexes and vast majority of stocks remains down, with only a few special situation names and some commodity-related titles able to buck the trend. We would say that, just in the past week, far fewer stocks joined the indexes at new correction lows, but we need to see such rays of light lead to real, sustained buying pressures to take action on them. We advise remaining defensive.


Not surprisingly, this week’s list doesn’t have many stocks near new high ground, but we are seeing many that reacted well to earnings and have shown some positive volume clues. Our Top Pick is one of them, a new name in the resilient shipping group.

During the past couple of weeks, the market has put together a handful of solid baby steps; in fact, the rally has been enough to put the intermediate trend on watch—a bit more strength from here could produce a green light. That’s all to the good, but (a) we still have to see the signal actually occur, and (b) even if it comes, there’s still plenty of overhead to chew through given the damage seen over the past few months. That’s not to throw cold water on the rally attempt—we’re nudging up our Market Monitor to a level 3 tonight, but right now, it’s best to remain defensive and to go slow on the buy side.



This week’s list is again heavy on commodity-related stocks and special situations, along with some recent earnings winners sprinkled in. Our Top Pick is a medical firm that lifted above long-time resistance following a clean FDA approval.

The market did a decent job during the prior three weeks of getting in position to flash an intermediate-term green light, but it was a case of close but no cigar, and now the sellers are back at it, with stocks essentially having a mini-crash since last Thursday. It’s vital to remain focused on the evidence, which obviously remains negative, and to honor your stops for things that are falling out of bed. Looking ahead, there’s certainly enough panic and some positives in the broad market to put in a low, but of course we have to see the buyers step up and take control before putting much capital in harm’s way.

This week’s list has a collection of decent-looking stocks—nothing is really great here, but these names are either in overall uptrends or have shown recent buying power. Our Top Pick is from the latter camp, with shares miles above their prior low and recently reacted well to earnings.

Current Market Outlook


After a very strong rally from the late-January lows, the major indexes are again in the midst of a pullback—during the past week and a half we’ve seen a few days of churning and distribution as worries over inflation (and a less-loose Federal Reserve) cause some profit taking, and today saw a big rotation out of growth stocks. Could this be the start of a “real” correction? It could be, as the intermediate-term advance is long in the tooth and sentiment remains giddy. That said, we never anticipate, and so far, we really haven’t seen much abnormal action yet—while a few stocks have fallen apart after earnings, most leaders are intact and even the weakest major index (Nasdaq) is near its 25-day line, which is acceptable. Given some of the yellow flags out there, our antennae are up, but with most of the evidence still positive, we’re keeping our Market Monitor at a level 7.

This week’s list has many recent earnings winners, including a few that are busting loose from good-sized bases (regular or post-IPO). Our Top Pick is Wix.com (WIX), which has a great story, accelerating growth and just staged a very powerful breakout.

Stock Name	Price	Buy Range	Loss Limit
The AZEK Company (AZEK)	47	45-47.5	40.5-41.5
Deere & Company (DE)	338	318-328	288-294
DraftKings Inc. (DKNG)	60	59.5-62.5	52-53.5
Magna International Inc. (MGA)	87	81-85	73-75
Mohawk Industries (MHK)	174	162-168	146-149
MongoDB (MDB)	392	395-407	355-365
SelectQuote (SLQT)	30	27-29	24-25
Sonos (SONO)	38	34.5-36.5	29.5-30.5
Teck Resources Limited (TECK)	23	21-22	18.7-19.5
Wix.com (WIX)	335	333-346	295-305

Current Market Outlook


It’s usually hardest to keep things simplest, which is why we put our main emphasis on the trends of the major indexes and action of leading stocks—and with both of those still positive, we’re sticking to a generally bullish stance. However, there’s little doubt we’re seeing some late-in-the-advance happenings (heavily-shorted stocks going to the moon, wild rotation intraday among sectors, etc.) and, chart-wise, nearly everything is sticking straight up in the air (the Nasdaq was about 1,100 points above its 50-day line this morning). We never pick tops, but we also prefer not to leave our brains at the door, and there’s little doubt that the risk/reward for most stocks here isn’t great. Thus, we’re willing to give things some wiggle room, but we’re raising stops and being selective on the buy side, focused mostly on entering on dips.

This week’s list has a wide mix of stocks, and most have been either setting up during the past few months or staging initial pullbacks after huge runs. Our Top Pick is Cleveland-Cliffs (CLF), which is finally beginning to pull in after a big run—further dips would be tempting.

Stock Name	Price	Buy Range	Loss Limit
10X Genomics (TXG)	183	175-185	157-162
1Life Healthcare (ONEM)	51	48.5-50.5	42-43
Cleveland-Cliffs (CLF)	17	15.4-16.4	13.5-14
Cronos Group (CRON)	10	9.5-10.2	8.3-8.7
Goldman Sachs Group, Inc. (GS)	283	276-284	248-253
Inseego (INSG)	21	18.5-20	15.5-16.5
Peloton (PTON)	157	152-159	133-137
Schrodinger, Inc. (SDGR)	96	88-92	77-79
Shopify (SHOP)	1206	1170-1220	1050-1080
Unity Software (U)	151	148-153	133-136

Current Market Outlook


After one of the wildest weeks in months, you’ve probably seen countless articles talking about the action and the reasons for it. To us, though, it’s what happens during the next few trading sessions that will count most—right now, the intermediate-term trend of the major indexes is up, though it’s more of a mixed bag for leading stocks (both growth and cyclical). In our view, there’s been enough iffy action to warrant some action; we’re moving our Market Monitor down to a level 6 in today’s issue and have a fair number of sells. But what comes next will count most, with a strong, broad rebound (including some positive earnings reactions) likely boding well, while an inability to bounce/further selling possibly putting a nail in the coffin of the post-November advance. For now, we’re paring back and tightening stops but still giving most of our winners a chance to hold support and resume their advances.

This week’s list has a surprising number of solid charts given the recent turmoil, though we generally still favor buying on dips or some tightening action. Our Top Pick is PagerDuty (PD), which is refusing to budge.

Stock Name	Price	Buy Range	Loss Limit
Affiliated Managers Group, Inc. (AMG)	114	108.5-111.5	98-99.5
Aphria Inc. (APHA)	13	11.5-12.5	10-10.5
Axon Enterprise, Inc. (AXON)	166	157-163	140-143
Marvell Technology Group (MRVL)	53	50.5-53	45.5-47
Matador Resources Company (MTDR)	16	15-16	12.8-13.3
The Michaels Companies (MIK)	15	14.5-15.2	12.8-13.2
Novavax, Inc. (NVAX)	269	225-245	185-200
PagerDuty (PD)	51	47-50	41-42.5
Penn National Gaming (PENN)	104	97-104	85-88
Redfin (RDFN)	75	72-76	64-66

Cabot Cannabis Investor has delivered several excellent trades in the past month.

* Back on October 31 I was very bullish on the cannabis group which was weak because of the nomination of Rep. Mike Johnson (R-LA) as House speaker. He has always opposed cannabis legislation. I argued there were several other catalysts in the mix regardless of how Congress acted on legal reforms. “Cannabis stocks are a strong buy in the weakness,” I wrote.

I suggested any of the names in our portfolio, or the AdvisorShares Pure U.S. Cannabis (MSOS) exchange-traded fund (ETF) and the leveraged version, AdvisorShares MSOS 2x Daily (MSOX), for simplicity. “I am adding to MSOS and MSOX in the weakness, and I will continue to add, particularly if they get weaker from here.” Since October 31, here’s how those trades have done.

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