Free Trend Following Trade Ideas for February:
2017 has been a great year for trend following so far. And I’m cautiously optimistic February will offer more of the same. After all…
A market in motion tends to stay in motion!
So I have some great new stock picks for you below. But first…
And in case you missed it…
Below are the picks from January. I encourage you to look through them as there are some big winners to be found.
While I’ve trailed my stop-loss higher on these winners, I think a lot of these are still in play.
- Trend Following Trade Ideas – January 2017 Part 1
- Trend Following Trade Ideas – January 2017 Part 2
- Trend Following Trade Ideas – January 2017 Part 3
- Trend Following Trade Ideas – January 2017 Part 4
- Trend Following Trade Ideas – January 2017 Part 5
Now to put some context behind these winners, let me just say the market has been strong.
Year-to-date, all of the major indices are in the green. And the NASDAQ is really off to the races.
See for yourself!
Digging a little deeper… you can see that every sector has been positive this year.
It’s just a question of how much.
If you want a closer look, this visual from FinViz illustrates the year-to-date performance of the market sectors quite well:
And by the way, this is in STARK contrast to last year! Do you remember the pullbacks in January 2016?
Times were MUCH more volatile.
So let’s make hay now, while the sun is still shining!
If… as the media reports, animal spirits are truly coming back to the market… well… I want a piece of the action!
Just look at the chart of the S&P-500 ETF below.
Do you see what I see?
Despite the depressing news coverage, US stocks are breaking out to new weekly-closing highs. Stocks are going up. Period.
I know there are lots of reasons to be bearish. I do. But as a trend following investor, I just have to put price action ahead of my armchair macro analysis. Make sense?
By the way…
It’s also why I’m fully invested in individual stocks and ETFs right now, despite lofty equity valuations and an array of global geopolitical uncertainties.
Of course, I actively manage risk with stop losses so that I know when to sell my stocks.
But a systematic price-driven approach does allow me to sleep at night despite a wall of worry.
Enough with the rear-view mirror analysis. Let’s look to the week ahead.
Trend Following Trade Ideas for February 2017 Part 1:
There’s lots of opportunity as we head in to the second month of 2017. Are you ready to put your money to work?
If so… here are some ideas I have on my radar…
First, I want to show you two stocks that I already own. But I think they are still actionable and I am actively considering adding to my position.
While pyramiding into a stock can be hard, it can also be immensely profitable with minimal risk.
As Paul Tudor Jones said, “Winners average winners.”
Open Trend Following Positions To Consider Adding to:
With that in mind, check out the chart of Medifast Inc (NYSE:MED) below.
For context: I’ve been building a position in MED since June of 2016.
I then recommended it on the blog again in October 2016. Since then, MED has just kept going up…
Since it looks like MED is emerging from this consolidation, I’m planning to add to my existing position with the stop-loss shown above.
I’m cautiously optimistic given these new closing weekly highs. Plus this example also shows that you don’t have to be a hyper-active trader to catch BIG trends in the market.
I’m up over 30% and am collecting a 3% dividend yield as the stock trends in my direction.
Transaction costs are also low. What’s not to like about that?
The next open position I want to share with you is Ferrari (NYSE:RACE).
I first laid out a trading plan for RACE in December when I picked up some shares. Since then, things have only gotten better.
Take a look:
In addition to the encouraging price action, just this past week Ferrari reported an earnings beat.
It seems the company is firing on all cylinders (pun intended!) The other thing I love about RACE is that shares are now above their pre-IPO price.
That means there is nothing but blue sky above. I love to own stocks in uptrends when there is ZERO overhead resistance.
Additionally, as RACE pays off debt, equity holders should see a growing share of earnings.
Now, I still encourage you to go through the January picks if you haven’t seen them, because there are lots more stocks there that I am still long and are looking good.
In addition to the current open positions, there are new stocks I’m also happy to share with you.
I don’t own these ones yet… but… am actively considering.
Let me know in the comments if you have skin in the game too!
By the way…
It is earnings season right now… so…
I STRONGLY encourage you to double-check any potential stock picks to be aware of when results are being announced and manage risk accordingly.
And as always, do your own diligence.
New Stock Trading Picks For Feb 2017:
Here are the new stock picks I’m looking at for February.
And managed to swing a healthy 25%+ win riding the uptrend. Unfortunately… I got stopped out with the swift pullbacks.
However, with MKTX back at new highs I’m looking to re-enter.
Here’s how I’ll play it:
I know it can be hard to buy stocks that have already gone up a lot.
But as long as you manage risk carefully, it can be a very profitable endeavour.
Take a look at Blackstone Group LP (NYSE:BX).
This premier private equity player was beaten down for most of 2016. But recently, things have started to improve.
Here’s a chart with where I would put a stop-loss, should I end up buying shares of BX:
The thing I like about BX is that the stock has been stair-stepping higher.
While it’s definitely volatile, the moving averages have re-aligned and are sloping up. So… I think BX could present some potential upside.
Note that my stop is wider than usual because of how volatile BX has been.
Another former stock pick I want to revisit is Huntington Ingalls Industries (NYSE:HII). Similar to MKTX above, I’ve had some success trading this stock in the past. And…
Now that it’s back closing out the week at new all-time highs, I’m looking to consider re-entering. Here’s a chart with potential stop loss:
Only time will tell, but for now it appears the market thinks this military ship builder is likely to thrive under a Trump administration.
I know it can be intimidating to buy expensive stocks. But this is a high quality company that’s worth the price.
Plus, I think the smaller float as a result of fewer share splits can help fuel faster price moves.
Anyways… there’s one more thing I want to show you… the XLV healthcare ETF:
While this sector has been a laggard year-to-date, I think it could be slowly setting up for a sector rotation.
So I’m keeping my eye on healthcare stocks that are breaking out.
And MASI is looking strong as well… although… they’re a little more levered than I like to see.
If they can get a tailwind from improved sector performance their could be some good movers.
This is definitely an area of the market I’ll be watching closely in the weeks ahead!
But that’s not all..
Even More Trading Ideas For Feb 2017:
By the way, with the market at new highs, there are plenty of stocks to pick from.
And while I’ve chosen my favourites here, I don’t want to limit you.
Here is one of my favourite FinViz stock screens from which I sourced most of these ideas.
You can also read more about how to find breakout stocks on FinViz if you want to use this strategy for yourself.
Naturally, there are some important due diligence steps you’ll need to do. But that’s a good place to get started if you’re looking for more homework.
And remember, the January trend following stock picks still have lots of ideas in play. So check ’em out if you’re still hungry for more trading ideas. See you next week!/
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