September Market Outlook: Stocks to Watch for Turnaround Tuesday
As we enter September, a historically challenging month for the markets, it’s important to keep a level head and not get swept up in extreme sentiment. Despite the recent downturn, there are still opportunities to be found in the market.
The key is to look beyond the broad indices and focus on individual sectors for potential opportunities. With a new season upon us, it’s a good time to establish a consistent theme for each day of the week:
– Technical Monday: Highlighting interesting technical setups
– Turnaround Tuesday: Identifying stocks, sectors, or commodities poised for a change in direction
– Hump Day Wednesday: Midweek analysis with expectations for the rest of the week
– Finale Friday: Reviewing the week’s performance and planning for the next week
Today, on Turnaround Tuesday, we’re looking at two stocks that are currently beaten down but could be ripe for a rebound.
Stratasys (NASDAQ: SSYS) is a 3-D printing company that has seen a significant decline in its stock price since July. Despite the challenges in the 3-D printing industry, a potential turnaround could be on the horizon if SSYS forms an island bottom pattern.
MP Materials (NYSE: MP) is a rare earth minerals mining company that recently announced a large buyback program. Despite a downtrend since April, the bullish divergence on the Real Motion momentum indicator suggests a possible change in direction if the stock clears the 50-DMA.
Here’s a summary of key ETF levels to watch:
– S&P 500 (SPY): Bullish above 550, bearish below
– Russell 2000 (IWM): Bullish above 212, bearish below
– Dow (DIA): Support at 410
– Nasdaq (QQQ): Warning phase with support at 455
– Regional banks (KRE): Pivotal at 57
– Semiconductors (SMH): Weakest sector with support at 217
– Transportation (IYT): Showing relative strength
– Biotechnology (IBB): New range between 145-150
– Retail (XRT): Testing the 50-DMA
– iShares iBoxx Hi Yd Cor Bond ETF (HYG): Risk-on unless it breaks 78
Overall, while September may be a challenging month for the markets, there are still opportunities for savvy investors. By staying informed, focusing on individual sectors, and identifying potential turnaround candidates, investors can navigate the market volatility and potentially profit from market changes.