Industrials Lead Stocks Higher Amid IBM’s Rally, Amazon’s Miss: 7 Stocks You Need to Know for Wednesday
With Starbucks pulling back ahead of its scheduled earnings report on Wednesday, buyers are backing industrials, with stocks like ^AKS^ and ^ROK^ gaining more than 6% and 3%, respectively. Swing traders will be watching to see if this buying in industrials extends to stocks like ^BA^ and ^GD^, both reporting earnings on Wednesday.
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Here are 7 Stocks You Need to Know for Wednesday.
Among the industrial and manufacturing stocks that led the S&P 500 higher were companies like ^ITW^ which gained more than 6% to close at new short term, overbought highs.
^AMZN^ pulled back for a second day in a row on Tuesday. Oversold as recently as last week, AMZN is again trading below its 5-day moving average.
The stock was lower in afterhours trading after reporting quarterly revenues that were better than expected and earnings that were worse than expected.
Shares of ^NFLX^ (below) pulled back by more than 9%. The stock closed on Tuesday at its lowest level in nearly than two weeks.
NFLX is set to open on Wednesday just outside of oversold territory above the 200-day moving average.
^SBUX^ is scheduled to report quarterly earnings on Wednesday. The stock closed lower for a second day in a row in trading on Tuesday, and is pulling back from a three-day rally that took the stock to the edge of overbought territory above the 200-day moving average.
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Swing traders are likely to have their eyes on ^RHT^ (below) over the next few days. Shares of RHT have closed lower for three days in a row, but are not yet in oversold territory.
RHT was last in oversold territory two weeks ago. The stock gained almost 7% from that oversold low before its most recent, three-day pullback.
Shares of ^CSCO^ (below) may attract the attention of swing traders looking to sell strength below the 200-day moving average.
Rallying to a new record high ahead of trading on Wednesday were shares of ^IBM^. The stock is up more than 3% from its last oversold close two weeks ago.
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7 Stocks You Need to Know Trading Tip of the Day
“Many people like to buy stocks when they’ve been beaten down over a long period of time. You’ll see people ‘bottom fishing’ stocks as they are plunging lower under their 200-day moving average (the kiss of death is when a ‘growth stock’ is referred to as a ‘good value’). Once a stock drops under its 200-day moving average, all bets are off. It’s better to be buying stocks in a longer term uptrend than in a longer trend downtrend, and here’s why.”
–Larry Connors, Short Term Trading Strategies That Work
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David Penn is Editor in Chief of TradingMarkets.com