Because the secular bull market takes a short-term pause, now’s the time to analysis great alternatives that lie forward. I’ve checked out greater than a thousand charts and wished to level out 3 particularly that I see heading a lot, a lot increased as we shut out 2024 and transfer right into a model new yr. There are tons of firms which were usually setting 52-week and all-time highs. Most of these are very overbought and carry extra short-term danger. I need to as a substitute deal with shares which were basing for an prolonged time frame and have simply made a breakout.
Inventory 1 – Amazon.com (AMZN)
I really like this breakout. We have really had two breakouts. The primary was the transfer above the 190 space, stopping at 200. Then extra not too long ago, AMZN cleared 200 earlier than revenue taking kicked on this previous week with choices expiration. We’re now again near that 200 assist degree. This is the 10-year weekly chart:
The present setup appears to be like eerily just like the setup heading into 2020. I belief this present breakout, contemplating that AMZN’s high in 2021 began a prolonged consolidation/basing interval – just like a cup formation. If we use that cup as a measurement stick for the potential rally forward in AMZN shares, we might be taking a look at 320. I might take that 60% acquire.
Inventory 2 – Fortinet, Inc. (FTNT)
FTNT is one other inventory that has a wonderful long-term monitor file, however struggled throughout a prolonged consolidation/basing interval since late-2021:
It is essential to level out that software program ($DJUSSW) simply broke out and it has been the third greatest business group because the present secular bull market was confirmed in April 2013, rising 774% over the previous 11 1/2 years. The one two business teams stronger have been pc {hardware} ($DJUSCR, +1019%) and semiconductors ($DJUSSC, +1488%). This compares to a 266% leap within the S&P 500. I am going to take a number one inventory in a number one business group, each of that are breaking out, ANY TIME.
Inventory 3 – Dwelling Depot, Inc. (HD)
Yep, that is 2 out of three Dow Jones part shares, becoming a member of AMZN. I really like the breakout right here. The patterns do not get any nicer and extra bullish than this one. HD topped in late-2021, similar to each AMZN and FTNT, earlier than continuing to print a lovely, symmetrical, rounded cup:
I see HD having a robust end to 2024 and a really stable 2025. Throw in HD’s 2.2% dividend yield, a dividend that is risen yearly because the flip of the century, and I imagine there are the makings of a “tremendous inventory” within the years forward. Regular grower with rising earnings as well! Sure please!
I see the Dow Jones Industrial Common being very sturdy for the foreseeable future, partly because of the AMZN and HD outlooks, however I nonetheless favor small- and mid-caps BIG TIME. I am internet hosting a webinar later this morning at 11:00am ET, “Capitalizing on Small- and Mid-Cap Power”. It is utterly free (no bank card required) to the general public, however you do must register for the occasion. You possibly can observe the hyperlink to take action and to be taught extra details about the occasion. If you cannot make the 11am webinar, completely no worries. All of those that register will acquire entry to the recording, together with these registering after the occasion has ended. So you should definitely REGISTER NOW to search out out why small and mid caps are poised to EXPLODE!
Additionally, my newest Weekly Market Recap video, “Month-to-month Choices and Destructive Divergences Hammer the Bulls!” has been revealed on YouTube. You possibly can watch it HERE.
Joyful buying and selling!
Tom
Tom Bowley is the Chief Market Strategist of EarningsBeats.com, an organization offering a analysis and academic platform for each funding professionals and particular person traders. Tom writes a complete Every day Market Report (DMR), offering steerage to EB.com members day by day that the inventory market is open. Tom has contributed technical experience right here at StockCharts.com since 2006 and has a basic background in public accounting as effectively, mixing a novel ability set to method the U.S. inventory market.
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