Last week was the best weekly performance for the S&P 500 and the Nasdaq Composite since March. To top it off, the both indexes touched their highest levels in nearly 9 months, even amid debt ceiling negotiations that appear far from resolved.
The chart patterns are also highly encouraging – pointing to an imminent breakout that could signal big moves higher.
Market breadth has also significantly improved, where instead of just a few mega-cap stocks driving the market higher, we are now seeing much broader participation. For instance, the equal-weighted Nasdaq100 index (where all participants get equal weighting regardless of market cap) is only slightly below the main index.
In short, market conditions are positive. Now may be a good time to get aggressive. Here are three stocks on my radar for this week.
Behind the Markets:
FDA APPROVAL COULD SEND THIS STOCK UP 46,751%Whenever the FDA approves a new drug…
Timely investors could see 300-400% returns overnight…
CCXI returned 281% to investors in one day… Relmada shot up 971% in 9 months… Agile soared 305% in 5 months…
Here’s the next stock we think wins approval >>>
Nvidia Corporation (NVDA)
Let’s be clear – NVDA is an expensive tech growth stock. But that’s also what could make it an attractive target this week. Its stock has been phenomenal, more than doubling this year, and is now sitting at near all-time highs last seen during November 2021.
For some, that could be a rightful reason to avoid this stock and buy back in when it’s cheaper. The question is – will it ever get substantially cheaper? The company’s Hopper GPUs, which entered the market last year, is considered by some to be the world’s most powerful – making it the ideal GPU for AI applications.
And with us only being in the beginning stages of the AI revolution, NVDA could be a massive beneficiary. The company reports earnings on Wednesday, May 24. That earnings report should provide better color on the stock’s longer-term prospects. The stock could go either way from there – either coming down from its lofty valuations, or continuing its incredible run.
Redfin Corp. (RDFN)
Redfin was a pandemic darling, with its stock nearly 10x-ing from March 2020 lows to its peak in February 2021. Since then, the online real estate brokerage has seen its stock come crashing back down, and in fact now trades at a price lower than those seen in the March 2020 bottom. This shouldn’t be surprising considering the Fed’s rate hikes means a mortgage is now more expensive than ever.
But zoom closer to 2023, and just like NVDA, Redfin’s stock has also more than doubled this year. It’s now a leaner meaner machine, having shut down its direct buying business – and thus removing inventory risk. Revenue took a big hit from that move, but that’s now in the past. Redfin still remains extremely popular, and now may be the time to buy the dip on this much healthier and less-risky stock.
LionsGate Entertainment Corp. (LGF-A)
LionsGate is another stock that has been beaten down over the longer term – trading at half of what it was in June 2021 – but has registered a strong performance in 2023. Just like the other two stocks spotlighted today, it has also nearly doubled this year.
Its chart pattern over the past few weeks has shown a tightening consolidation pattern that often precedes a big move higher. Plus its top-line revenues have improved over the past year – despite its stock price having fallen significantly. This is undoubtedly a lesser-known stock – but one that could present a significant opportunity for savvy investors.
To your wealth,
Felix @ Ace of Investing