Top Value Stocks - High-Yield Dividends
The Momentum Rider investor series continues as we take a look at the coming week's action and also more areas to look for to find top value stocks. This week is going to be focused on value stocks with 200 SMA breakouts that have high-yields. Long consolidation breakouts can be very good and safe trades as the price support is well established. In this case the 200 SMA serves as very strong support. Once the momentum moves out of the base to the upside, any remaining shorts will need to cover and the move can be fast and very powerful. These stocks have good valuations and should see substantial moves up as the world economies recover and they can be viewed as both good trades and good investments. The high dividend yields give these stocks both capital appreciation and income.Friday of last week was a big boost for confidence in the US markets. It helped continue the rally for the S&P 500 to test the 2011 highs near 1370 and the COMP is testing 5 year highs and the high for 2011. The DJIA also is testing its 2011 high. Typically, the first time back up to test previous highs fails initially and that will probably happen with the DJIA this week.
However, it was another positive week as institutions, money managers, and fund managers continue to buy and chase this "surprise" strong performance. This move up without a decent size pullback has caught many hedge funds off guard and they continue to accumulate late in the rally to catch up.
The start of the year has been dominated by more optimism in Europe coupled with bullish news out of the US and China in many different areas. In addition, Apple's very strong earnings and a bounce from semiconductors have given technology the strongest start to a year in some time. That is important when trying to forge a bullish US market trend in the face of a struggling Europe.
We have previously detailed the many improvements that have occurred since the Europe financial crisis was averted late last year by the world central banks. And just this weekend, China gave even more of a backstop potential for Europe when they indicated they are willing to help with the ESM (European Stability Mechanism). China has very deep pockets and their support will be critical to get past the big Italian payment due in March. It could also be important in helping with Portugal's debt problems that have recently spiked.
Greece is still pushing their agreement out again to this week and the markets are way overdue for a 3 to 4% pullback. But that is a healthy and normal correction and expected. With all of the money on the sidelines for both individual investors and businesses, it leaves plenty of more room on the upside in 2012. Our initial target of 1360 to 1370 for the first quarter may be eclipsed at the rate the markets are moving and 1400 can't be completely ruled out.
Expect some consolidation and selling this week but the bulls are still in charge for now. The 1300 area is strong support on a pullback and 1360 is the upside target if the market keeps moving up this week.
Using the Power Stocks Table:
(1) Risk: Conservative (Cons); Moderate (Mod); Aggressive (Aggr); Speculative (Spec)
(2) Stop: Typically use a 3 to 4% closing stop below the entry price
(3) Trailing Stops: Use the 10 EMA (Swing) or 20 SMA (Short Term Trader) for protecting gains once above it; SMA = Daily Simple Moving Avg; EMA = Daily Exponential Moving Avg.
Value Stocks - Consolidation Breakouts Above the 200 SMA
Today's stock picks will be highlighting more value stocks that are breaking out of consolidation and sideways moves just above their 200 SMA. This is a really good place to enter a trade or an investment with a strong support right beneath the entry. This week's picks will be a mixture of sectors but mostly high-yield dividend stocks.
Value Stocks with High-Yield Dividends:
Investor Notes:
We will be writing a blog this week on Apple so keep an eye out for it. Remember to check out our recent blogs on precious metal miners and long term treasuries if you haven't read them yet.
Check out our newest FREE promotional offer called the MR Market Crusher Pack for 2012 (click link). It includes 5 very valuable investor products worth $600 to get you started with a bang in 2012 for your retirement account.
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Good luck in your trading and investing,
CEO Jalexa Trading Consultants, LLC
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