The Stock Market has pulled back over the last two weeks.
The SPY dropped 3% and the same with the QQQ’s. What do you do in a time like this? Easy look at the past, block out emotions, news and look for great deals. A lot of people end up panic selling thinking of doom and gloom situations and how they cannot afford to lose any more money. Do you swing trade in times like this? Buy stocks on the pullback for the long haul? Swing trade leveraged ETFs? Just depends on your style. The best thing you can do if you mentally and emotionally cannot handle the swings is to set up something like E*TRADE's automatic investing account and just continue to add weekly and do not even pay attention to the market if you cannot stomach it. There is always risk in the market and yes bull markets do end, and bear markets do happen, but do not live-in fear. If you are buying companies, you like now you should love them cheaper and average down your position.
Two stocks to watch based on their chart alone.
1. HOLX Hologic Inc https://www.hologic.com/
This company is in the healthcare sector mostly in diagnostic equipment. They are a manufacture of a Covid test and considering all the mandates coming out should defiantly give them a little more business. The chart shows a 5% potential just to their most recent high and about a 10% potential if it goes back up to the February high. With the market in a pullback state, to see this stock having a green day, very oversold and above the 50 and the 200 simple moving average makes it a good entry point for a swing trade or a long-term hold. It also seems to be performing a perfect bounce off the bottom Bollinger band. It has an average buy rating with a price of $83.83 which is an 8% upside and a high price target of $95 which would give you a 22% gain. Of course, it could find its way back down to the $60 area, but I am more inclined to believe this will produce a 5-10% gain in the short term. It is only trading at a 9.9% PE, so it is not overly expensive.
This company is a REIT (Real estate investment trust) and pays a quarterly dividend of 2.2%. That is not what I am buying for, but some people do look for REITs and Dividends in general. What drew my attention was the chart. It has had about an 8% pullback from its recent highs, in the oversold area, looks to be bottoming and looking for a reversal right above the 50-day simple moving average which looks like a great area of support. Keep in mind this is trading at a 102 PE which is expensive, but some things just are, and that does not mean you cannot swing trade a 10% profit in the next month. Looking at the business, their properties, dividends etc. This may not be a bad way to invest in the real estate market without owning and managing property, just keep your dividends reinvested.
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