Current Market Outlook
After last Monday’s plunge, the initial rebound was very encouraging, and the fact that the major indexes are still doing their best to hang in there is a plus. But, while many individual stocks are in decent shape, the wild rotation that has been a hallmark of 2021 has returned, with money racing into cyclical areas and out of growth stocks the past couple of days. We’re still sticking with a stock-by-stock approach, and most names, despite their wobbles, remain in fine shape, simply pulling in after big runs; others, however, look worse and should be pared back or sold. To be fair, such action isn’t totally surprising—big breaks like last Monday’s usually have some reverberations, so we wouldn’t say the action is negative as much as it’s a sign we’re still in the tricky, choppy environment that has existed for some time. We’re going to leave the Market Monitor at a level 5 and see how things play out in the days ahead.
The good news is that this week’s list is full of names that have enjoyed outsized accumulation of late. Our Top Pick is
Devon Energy (DVN), which looks like a leader of a fresh breakout in energy stocks (and cyclical stocks more broadly). We suggest aiming for dips as these names usually pull in after powerful rallies.
| Stock Name | Price | Buy Range | Loss Limit |
|---|
| Apache (APA) | 23 | 22-23.5 | 19.5-20 |
| Biohaven Pharmaceutical Holding (BHVN) | 133 | 130-134 | 116-119 |
| Brooks Automation, Inc. (BRKS) | 109 | 102-106 | 93-95 |
| Cimarex Energy (XEC) | 88 | 82-85 | 72.5-74.5 |
| Devon Energy (DVN) | 35 | 32-34 | 28.5-29.5 |
| DoorDash (DASH) | 217 | 206-212 | 185-189 |
| SeaWorld Entertainment Inc. (SEAS) | 58 | 56.5-58.5 | 51.5-52.5 |
| Signet Jewelers (SIG) | 84 | 82-85 | 73-75 |
| Snap Inc. (SNAP) | 80 | 78-81 | 69-71 |
| SVB Financial Group (SIVB) | 674 | 655-675 | 600-610 |
