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Stock Pick Update: March 25 - March 31, 2020

 

March 25, 2020 (Investorideas.com Newswire) Last week (March 18 - March 24) has been a roller coaster ride for the broad stock market. The S&P 500 index dipped below the previous local low on Wednesday, before bouncing off from 2,300 level and getting back to 2,450. Then on Friday and Monday it sold off to the new medium-term low of 2,191.86. On Monday it was a stunning 35.4% below February 19 record high of 3,393.52. The corona virus and economic slowdown fears have erased more than a third of the broad stock market value! Yesterday we saw huge come-back rally, as the S&P 500 index got back to 2,450 level again. Our last week's Stock Pick Update has been released just before the mentioned roller coaster ride. Was it a bottoming pattern before a rebound or just upward correction before another decline? We will certainly see more short-term volatility.

The S&P 500 index has gained 0.44% since last Wednesday's open. In the same period of time our five long and five short stock picks have gained 4.07%. So our stock picks were relatively stronger than the broad stock market, as they regained some of last week's lost ground. Short stock picks have outperformed lagging long stock picks, as they've gained 8.53%. Long stock picks lost 0.38%, so they basically followed the index in the last five trading days. The overall results remain relatively better than the S&P 500 index over last weeks.

If stocks were in a prolonged downtrend, being able to profit anyway, would be extremely valuable. Of course, it's not the point of our Stock Pick Updates to forecast where the general stock market is likely to move, but rather to provide you with stocks that are likely to generate profits regardless of what the S&P does.

This means that our overall stock-picking performance can be summarized on the chart below. The assumptions are: starting with $100k, no leverage used. The data before Dec 24, 2019 comes from our internal tests and data after that can be verified by individual Stock Pick Updates posted on our website.


Below we include statistics and the details of our three recent updates:

  • Mar 24, 2020
    Long Picks (Mar 18 open - Mar 24 close % change): LW (+9.21%), BDX (-15.16%), PEG (+0.30%), SLB (+10.00%), AXP (+5.04%)
    Short Picks (Mar 18 open - Mar 24 close % change): COG (-12.05%), PGR (-5.79%), ITW (-7.68%), HSY (-7.78%), REGN (-9.33%)

    Average long result: -0.38%, average short result: +8.53%
    Total profit (average): +4.07%
  • Mar 17, 2020
    Long Picks (Mar 11 open - Mar 17 close % change): ADM (-1.26%), AES (-21.68%), SPG (-45.84%), PSX (-23.54%), BAC (+3.77%)
    Short Picks (Mar 11 open - Mar 17 close % change): COG (+14.72%), CME (-17.57%), NOC (-1.88%), CLX (+14.35%), WEC (+2.48%)

    Average long result: -17.71%, average short result: -2.42%
    Total profit (average): -10.07%
  • Mar 10, 2020
    Long Picks (Mar 4 open - Mar 10 close % change): VNO (-8.94%), WBA (+4.26%), PFE (-1.45%), NBL (-40.68%), JPM (-14.92%)
    Short Picks (Mar 4 open - Mar 10 close % change): APA (-57.45%), PGR (-0.09%), ROK (-9.59%), EQIX (-2.51%), KR (+9.84%)

    Average long result: -12.34%, average short result: 11.96%
    Total profit (average): -0.19%

Let's check which stocks could magnify S&P's gains in case it rallies, and which stocks would be likely to decline the most if S&P plunges. Here are our stock picks for the Wednesday, March 25 - Tuesday, March 31 period.

We will assume the following: the stocks will be bought or sold short on the opening of today's trading session (March 25) and sold or bought back on the closing of the next Tuesday's trading session (March 31).

We will provide stock trading ideas based on our in-depth technical and fundamental analysis, but since the main point of this publication is to provide the top 5 long and top 5 short candidates (our opinion, not an investment advice) for this week, we will focus solely on the technicals. The latter are simply more useful in case of short-term trades.

First, we will take a look at the recent performance by sector. It may show us which sector is likely to perform best in the near future and which sector is likely to lag. Then, we will select our buy and sell stock picks.

There are eleven stock market sectors: Energy, Materials, Industrials, Consumer Discretionary, Consumer Staples, Health Care, Financials, Technology, Communications Services, Utilities and Real Estate. They are further divided into industries, but we will just stick with these main sectors of the stock market.

We will analyze them and their relative performance by looking at the Select Sector SPDR ETF's.

The stock market sector analysis is available to our subscribers only.

Based on sectors' relative performance analysis, we decided to choose our stock picks for the next week. We will choose our top 3 long and top 3 short candidates using trend-following approach, and top 2 long and top 2 short candidates using contrarian approach:

Trend-following approach:

  • buys: 1 x Technology, 1 x Consumer Staples, 1 x Health Care
  • sells: 1 x Energy, 1 x Financials, 1 x Real Estate

Contrarian approach (betting against the recent trend):

  • buys: 1 x Energy, 1 x Financials
  • sells: 1 x Technology, 1 x Consumer Staples

Trend-following approach

Top 3 Buy Candidates

INTC Intel Corp. - Technology


  • Breakout above downward trend line
  • Resistance level of $60 (upside profit target level)

STZ Constellation Brands, Inc. - Consumer Staples


PFE Pfizer, Inc. - Health Care


  • Potential upward reversal pattern - upward correction play
  • The resistance level of $32.50
  • Positive divergence between the price and RSI indicator

Summing up, the above trend-following long stock picks are just a part of our whole Stock Pick Update. The Technology, Consumer Staples and Health Care sectors were relatively the strongest in the last 30 days. And they have lost less than the S&P 500 index in the same period. So that part of our ten long and short stock picks is meant to outperform in the coming days if the broad stock market acts similarly as it did before.

We hope you enjoyed reading the above free analysis, and we encourage you to read today's Stock Pick Update - this analysis' full version. There, we include the stock market sector analysis for the past month and remaining long and short stock picks for the next week. There's no risk in subscribing right away, because there's a 30-day money back guarantee for all our products, so we encourage you to subscribe today.

Check more of our free articles on our website - just drop by and have a look. We encourage you to sign up for our daily newsletter, too - it's free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to our premium daily Gold & Silver Trading Alerts. Sign up for the free newsletter today!

Thank you.

Paul Rejczak
Stock Trading Strategist
Sunshine Profits - Effective Investments through Diligence and Care

Disclaimer

All essays, research and information found above represent analyses and opinions of Paul Rejczak and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Paul Rejczak and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Rejczak is not a Registered Securities Advisor. By reading Paul Rejczak's reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Paul Rejczak, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

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