Trend Following Trade Ideas for June 2017 (Part 4):
Welcome to the summer! It looks like strong stocks are getting stronger, as we kick off this new season!
Or at least, that sure seemed to be the theme in the market this week!
At the start of June I mentioned that healthcare stocks might be on the verge of breaking out.
So it was encouraging this week… when… strength in the pharma, biotech and other healthcare stocks made itself known in a big way!
Take a look:
And given that healthcare stocks have been going sideways for almost 2 years, it feels to me like this move could just be getting started!
In fact, even beaten down names like GILD put in high conviction moves. Could there be big money positioning for higher prices?
Biotech stocks are also feeling the love. And if you don’t remember the strength of biotech names from 2012-2015, well, let’s just say these stocks can TREND:
So I’m pretty encouraged by the weekly close… especially since…. they’ve broken out to 1-year highs on pretty strong volume
And that’s why I think this sector is still worth watching
It wasn’t ALL roses and sunshine in the stock market this week.
Trend Following Stocks I Sold This Week:
Even though there are areas of the market I’m quite bullish on, I did have a couple of stop loss orders trigger this week. And there were definitely some breakouts that fizzled!
CMCSA and XIU.TO gave me exit signals. I know it can be frustrating to get stopped out (especially when it’s for a break-even trade). But…
“It’s very important you stick your trading system!”
That’s because… over time… process is MUCH more important than a single given trade.
And in this bull market, I’m eager to cut laggards and buy winners… Make sense?
Great. Then let’s get into some new trading ideas.
Trend Following Stock Trade Picks for June 2017:
I had a lot of fun last week sharing my new stock buys. Plus, the feedback from readers was great.
So right off the bat…let me tell you about my recent moves.
New Trend Following Stock Buys This Week:
First of all, Friday morning I picked up some shares of the solar ETF, TAN.
Now usually, I like to buy individual stocks. But solar seems to be catching some momentum and I wanted to get in on the action. Unfortunately…
I’m not THAT familiar with any of the individual solar stocks. So since I was short on time and eager to pull the trigger, I decided to go with the ETF.
Here’s how I’m playing the trade:
It’s always encouraging when my buys go immediately into the green. And by the end of the day, I was already up over 2% on this new ETF buy.
I can’t complain about that quick win. But I’m also playing for a MUCH bigger move! And I’ll likely add to my TAN position over time if it keeps trending in the right direction.
So if you were so inclined, I don’t think it’s too late to buy – as long as you have a plan for when to sell!
Looking North of the border…
Since I got stopped out of my XIU.TO position, I also had some CAD to put to work this week.
So not only did I add to my Algonquin Power position, I picked up shares of the Dream Industrial REIT and WinPak. towards the end of the week.
The WPK.TO chart is probably the most notable of the group:
I’m always encouraged when stocks can make new weekly closing highs, without being too stretched above their recent consolidations.
I find this kind of pattern can sometimes portend a continuation of momentum.
Speaking of ongoing momentum…
New Trend Following Breakouts to Watch for June 2017 (Part 4):
There are a couple of existing positions that are holding up really well for me. And I’m considering adding to them, so I wanted to show you the charts.
Of course, I know it can be uncomfortable to buy stocks at new highs. But good stocks can keep going up for longer than you think.
And as long as you manage risk carefully… well… it can be worth averaging up!
So first of all…
Check out how Ferrari stock (RACE) has been holding up this week. See for yourself:
I’m encouraged by the orderly consolidation shown above. So if RACE can push to new highs, it’ll likely be on top of my buy list.
That said, I do prefer to wait for a new breakout to trigger a buy on this stock. Because after all, at time of writing I don’t know how well Ferrari did in the Azerbaijan Grand Prix this weekend!
On the other hand…
I like the way Square (SQ) has pushed above the recent area of consolidation, and is now closing near the highs. Plus, it’s up over 20% since I first shared the idea in May (here)!
So in my opinion, while TWTR has had lots of excitement lately the Jack Dorsey company I really like is SQ. This chart is much more constructive from a trend following perspective.
Another tech stock breaking out to new highs is Taiwan Semi Conductor. TSM has been acting well, and after a few weeks of consolidation it’s trying to get going again:
This breakout to new closing highs, in the context of a larger uptrend, is exactly the kind of setup I’m comfortable buying.
Of course, anything can happen in the market and I could easily get stopped out. But I always have a stop loss in place and reasonable position size, so I’m happy to take the risk.
Another stock I want to point out is BAX. The impressive weekly candle should embolden bulls going forward.
Now while I’m liking the way BAX looks, there are lots of healthcare names that may be worth checking out (too many to mention here).
That should keep you busy, if you want to dig a little deeper in this space! There are no shortage of breakouts.
Another idea that caught my eye this week is FBHS. Once again, I just like the way it’s breaking out to new highs, following a multi-month consolidation:
I currently own a small position in FBHS, but this continuation breakout has me rubbing my hands to buy more.
Finally, I also want to point out the chart of Corning. Shares of GLW have been in a strong (albeit bumpy) uptrend.
And to my eye at least, they look like they could pop again:
Not bad, right? Due to the more volatile nature of this uptrend I’d perhaps widen my stop a bit more than usual (and thus reduce my position size). But overall I think GLW looks good.
“I REALLY hope you’ve found these trend following trade ideas to be helpful!”
I’m always happy to talk about stocks. So I hope you had fun reading.
And of course…
If you want to see my whole portfolio of trend following stocks, you can simply click here to see my current holdings in a FinViz watchlist. I’ve set it up so you can quickly scan the charts to find the ideas that look good to you.
To be totally transparent, I should also mention there are a few Canadian stocks that FinViz doesn’t cover. Where possible I’ve included American tickers. But some of the REITs (DIR/UN, CU) and utilities (AQN, EMA) aren’t there.
But in any case… as you’ll see…
Owning a portfolio of trend following stocks… especially in a bull market… is a fun and profitable way to be in the markets.
So if you want to learn the exact step-by-step process I use to find these kind of trade ideas, well, just keep reading!
Learn How to Quickly Scan For Breakout Stock Picks:
If you want to learn more about how I find these kind of stock picks, I encourage you to check out my Breakout Stock Blueprint. What’s that, you ask?
Well… it’s an 80-page PDF… packed with everything I know about finding, buying and trading breakout stock picks.
This blueprint shares the EXACT step-by-step process I use to find and trade stock picks each week (just like the ones above). So…
If you want to see how to find high-potential-momentum stock picks, learn how to let your winners run and be confident about locking in profits, then this blueprint is for you.