A nice mix of stocks showed up on the MarketSmith Relative Strength Scan, with breadth improving overall. A broader group of stocks are moving back above their 50d moving averages in the process. The latter suggests institutions have been accumulating shares over a broader swath of the market.
Summary
Winning Stocks with Relative Strength
With futures higher this morning we’ll look for follow through from these candidates along with stocks in their individual industry groups.
Tesla stock (TSLA) rose more than 1.27% in early trading this morning, with the prospect of extending a reversal that started over the past 8 trading days.
The company also began deliveries of the Model Y from its Berlin auto plant, in the process establishing a manufacturing base in central Europe.
Shares closed above the 50-day moving average on Monday, building the right side of a potential cup base. Our targets are 1115 and 1208 short term. The stock traded up to 1,243.49 the first week of November 2021. Pre-market the stock is 18% below that 2021 all-time high.
Winning Stocks – Container and Bulk Shipping
Powerful supply-chain bottlenecks are driving up rates propeling the shipping sector price action to ever higher levels in 2022. As a rsult, this perstitent trend has allowed shippers and container companies to charge higher prices.
Genco Shipping & Trading (GNK) surged nearly 10% on Wednesday, closing +2.01 higher for the session. In addition, the stocks relarive strength line (RS) rose to 98 on above average volume.
Our positions in ZIM Intergrated Shipping (ZIM) are still bullish closing higher for a fifth week, while consolidating recent gains on Wednesday. Entries started on January 28 with this post.
Genco broke out of its base on Wednesday, so we’ll look for follow through Thursday and Friday. If price action closes in this area, it will mark the 9th week of higher prices that started on January 24.
Earnings are projected to increase 9% in 2022 to $4.66/share. The company also boasts a IBD Composite Rating of 99, an overall score for the stock by combining all other IBD SmartSelect Ratings into one, with more weight on the EPS and Relative Strength (RS) Ratings.
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Happy Trading,
Vinny
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