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By: Tom Gentile
on September 11th, 2024
Stocks at 52-Week Highs Despite Markets Dropping the Past Two Days
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I am going to show you how I use my Tools to find stocks that are “bucking the trend.”
What do I mean by that? The markets had a two-day sell off, Day two being today. Despite that and the concern of a further short-term decline in the markets, one tact people can take is trying to find stocks at their 52-week high. This can be looked at as Positive Relative Strength.
For newbies to the site www.tomsoptiontools.com one of my scanning tools gives me a daily list of stocks that are trading at their 52-week highs and 52-week lows.
A stock’s 52-week high is the highest price that a stock has traded at over the last year. And, as I’m sure you guessed, a stock’s 52-week low is the lowest price that a stock has traded at over the last year.
This information can help investors and traders alike determine the long-term trend of a stock before putting any money into it. And today, for example, Lockheed Martin (LMT) is at the top of the list with a 100% number – meaning it is in the top 100% of its price range for the 52 weeks.
To your success,
— Tom Gentile
Market in Focus
Tools and Observations
Notice many of the names on the list like Wal-Mart Stores (WMT), Altria (MO), Proctor & Gamble (PG), Johnson & Johnson (JNJ) and General Mills (GIS).
What do these stocks have in common?
They are all classified as “Defensive Stocks.”
Defensive stocks are labeled as such, because they usually provide a consistent dividend and stable earnings numbers regardless of the market conditions overall. There’s a continuous demand for these companies’ products so their price tends to be more stable; they experience less volatile stock price movements during the many different phases of the business cycle.
Recognize this article is being written on a day the markets have had a hefty 2-day drop yet this category of stocks are performing well.
Can one consire trading a stock at their 52-week low. Sure if they and their broker find it a suitable idea for the portfolio.
One can look at a further decline under the guis of weakness could beget more weakness.
Or from the perspective one is looking for a 52-week turnaround candidate. In that case they would research the copany to see if whatever bad was happening with the company is getting resolved, whether it be new management, product/service, government contract or drug approval, etc.
Then after your broker discussion you can take what ever action you all deem fit.
To your success,
— Tom Gentile
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