Trend Following Stock Trade Picks for May 2017:
Welcome to the weekend! I’ve got a pretty busy couple of days coming up. So I’m going to keep this update on the short side.
But as a reminder, many of the stocks picks from the last few weeks are still looking great.
So you can always check those out when things here are thing.
Not that there isn’t opportunity…
Overall, the market has consolidated near the highs. Although oil has continued to struggle, new 52-week highs still outnumber new 52-week lows. And…
Zack’s reports earnings season is going well, with strong top-line growth across most of the S&P-500 (so far).
Now…. with that in mind… let me show you the stocks on my radar heading in to the Monday morning trading session.
Trend Following Trade Ideas for May 2017 (Part 2):
Okay, let’s get down to business. There are definitely some interesting trading ideas this week, so here we go.
First, I want to talk about some recent buys I made this week. You see…
I had a couple of stops trigger earlier this week (DIS, BOJA). And that meant I had some money to put to work.
Plus, I had some other idle cash I’d recently added to my brokerage account. Now as always, this is just my personal opinion but I thought you might be curious…
Be warned though, with the exception of ROL these are all new positions. Also, since the stocks are a bit extended I sized-down a little.
Here’s how I’m playing it:
Now, I’m comfortable adding to this position because I already have a 2R open profit on the trade. So adding another 0.5R of risk is fine with me. Because…
As long as there isn’t a big gap down, I should be able to close this position at a profit. Of course, anything can happen in the market, but I’m willing to press my bets on this,
Okay… the rest of the stock picks are new positions for me.
Well, in some cases I’ve owned the stocks before. But these are my first buys (even if they look extended!)
So in alphabetical order, the first chart on the list is AOS. You can see my analysis of it on Seeking Alpha here. I think it’s an interesting business and always curious when I see it hitting new highs,
One of the things I like about AOS is that shares are breaking out from a longer sideways consolidation.
I think a similar but different situation is happening with RYAAY. Although the base is a little bit different, the longer-term view indicates the stock might have room to run
That said, it is sometimes hard to buy stocks after they’ve made a big move. So with RYAAY and the rest of the buys below I kept positions relatively small.
Next up, ISRG is another former holding that I think has an interesting business model <SA link>. And as you can see below, the stock is charging higher:
Again, given how extended the stock is I’m not exactly jumping in with both feet. But experience has taught me that high-quality businesses can continue to trend up for longer than you might first think logical.
Another completely new buy is FOXF. The longer-term fundamentals look good on Morningstar <key stats link>, and I’m curious to learn a little more about the business.
For now, I dipped a toe in though:
I’m not crazy about the end-of-week fade. But I do like the consolidation pattern it’s emerging from. If buying volume gets kicked up a level, I’ll be even more enthusiastic.
I always love when I see people making the bull case for stocks that show up on my favourite stock screens.
So you know I was happy when I saw the esteemed Howard Lindzon mention he was long MELI too.
Here’s how I’ve gotten involved:
I know it can be hard to buy stocks up here. And as I mentioned, I’ve kept my position small as a result. But I’ve also learned great companies riding big trends can keep running…. (just look at that ROL chart again!)
Now… finally… one stock that I haven’t bought yet, (but which I’m keeping an eye on) is FEYE. I first saw it mentioned Thursday night on Twitter by Larry.
Here’s the chart:
As you can see, this chart might be carving out a bottom. And the volume pattern has been impressive. I’m also very encouraged to see it closing out the week at the highs.
I hope you find these picks helpful. To give you even more context, starting last week, I decided to share the stocks in my trend following portfolio with you.
So, in order of biggest to smallest:
If you look up the charts of some of these stocks… you’ll see… some of them are absolutely knocking it out of the park! SHOP, RACE, TTC and many others have been running month-after-month. Are you getting in on this action?
And by the way…
Before I wrap this up I just want to say a BIG THANK YOU to everyone who supported the launch of the Breakout Stock Blueprint!
I was completely overwhelmed by the interest and am VERY grateful.
The support from readers absolutely blew away my expectations! It’s been a lot of fun and based on the feedback so far people seem to really be getting value.
So… if you too want to learn how to find AND trade breakout stock picks… keep reading!
Learn How to Scan For Breakout Stock Picks:
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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…
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