Hey there, Power Profit Traders!
Finding profitable trades is all about knowing where to look.
Experienced traders and investors know what patterns to watch for in the markets, and have rules for placing trades when specific patterns arise.
My Surge Strike strategy is especially helpful when market volatility becomes inflated, like right now, so I’ll be focusing in on these setups in the coming weeks!
In today’s Power Profit Trades LIVE session at 11:30 a.m. ET, I want to touch on Bitcoin (BTC) and a few crypto headlines, but I’ll also look at three sectors I’m stalking amid the Russia-Ukraine conflict…
One of these sectors may be considered relatively “boring” by many traders, but it’s been generating a lot of attention as Wall Street seeks “safe havens” during these uncertain times.
Finding Safety in… Ketchup?
With tensions running so high lately, it’s no surprise that people have been taking money out of tech stocks and putting it into “boring” places.
I say “boring” because these stocks aren’t the ones we see in the news very often, but they are generally considered to be things people need.
In the table below, you see a list of S&P 500 Index (SPX) stocks and where they are in relation to their recent highest high; stocks near the top of the list are near their highest high and have been outperforming.
Stocks High/Low Ranking Feb. 24
Some of the highlights from the top of the list are The Kraft Heinz Company (KHC), American Electric Power (AEP), and Keurig Dr Pepper Inc (KDP).
What I’m seeing is during this time of increased uncertainty, the stocks that are performing the best are things people will buy regardless of what is going on around the world — consumer staples, such as ketchup and coffee.
Check out The Kraft Heinz Company (KHC) as it started to climb two weeks ago with its earnings announcement!
The Kraft Heinz Company (KHC) with Implied Volatility Overlay Feb. 25
This, even as the rest of the market took it on the chin.
If you want to learn how to find high-probability trade opportunities around volume surges, we have weekly training sessions as part of Operation Surge Strike to stay current with the markets!
The Consumer Staples Sector is where we find a good representation of how these “boring stocks” are performing:
SPDR Consumer Staples ETF (XLP) Feb. 25
Compare that to the Technology Sector, which is where we find stocks like Apple (AAPL) and Tesla Motors Inc. (TSLA):
SPDR Consumer Staples ETF (XLK) Feb. 25
Although visually similar, the Consumer Staples Sector is outperforming the Technology Sector.
As further evidence that Tech Stocks are underperforming during this season of unrest, here are the stocks ranked at the bottom of the High/Low table.
Remember, the 0.00% on the right column means they are making new lows. Notice how they are almost ALL Tech Stocks?
Stocks High/Low Ranking Feb. 24
If tech stocks are making new lows, does that mean I should be looking for trades somewhere else?
Not necessarily! The pullback presents an opportunity to buy some of the stronger tech names at a discount… but we will talk about that more in the Power Profit Trades LIVE session today!
There are two more sectors we’ll be looking at today, so be sure to join me at 11:30 a.m. ET for my Power Profit Trades LIVE session, because our discussion will be all about where to look for profit during times of uncertainty.
That’s all for today!
Tom Gentile
America’s #1 Pattern Trader
