The Watchlist and the IBD50
The watchlist for the week has numerous setups from the IBD50. Technology was strong last week, second to Biotech. Both remain our focus to start the session today.
Note the lower section which links to FINVIZ charts in the energy, oil and gas industry groups. Some of the big cap stocks look good. In addition, a few inexpensive “small cap stocks” in this sector are being bought. If IWM rallies this week, look for these names to continue. SWN, CHK, RIG examples of more risky names, due to “price.”
FIVE Five Below Inc is a specialty retailer offering merchandise for teen and pre-teen customers. Its merchandise includes everything from sporting goods, games, fashion accessories and jewelry, to hobbies and collectibles, bath and body and among others.
In its latest quarter the company reported recent quarterly earnings of $0.18 per share on revenue of $257.2 million. This was a beat of consensus earnings estimates (+0.05) on revenue of $244.9 million. Revenue grew 28.9% on a year-over-year basis.
Technically speaking, the stock is tracing out a rectangle patter, appearing to test the upper boundary on Friday. We are looking for a break higher, as RSI and MACD guide expectations.
If prices continue along its bullish path, it will continue into an area of little overhead supply, what we call the “Kirby.” Price action will most likely accelerate into this zone.
Watch for volume early on to confirm institutions are buying.
Stocks on the watchlist have a combination of RSI rising, with price action above a trending SOTEMA. MACD is above its signal line and volume is showing institutions are active. Look for these attributes in any stocks you consider buying this week.
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