While it has only been a few days of harsh selling, bulls are already saying, "Enough already!" The relief is expected to come in the form of an oversold bounce. Or maybe it'll come via a turnaround Tuesday. Or maybe we'll see great earnings expectations from Alcoa (AA) -- but seriously. While any of this may come soon, I think it's worth going over some of the names that ended up at the top of my daily momentum scans.
While I've now whittled this list down to a little less than half of the original, a lot of the charts I eliminated were ETFs that were extremely similar to ones that stayed on, or stocks that were major components of ETFs. What surprised me the most was the mix of the results. Unsurprising, however, were the inverse ETFs which appeared on the charts -- included those of the Nasdaq, the Russell 2000, the S&P 600 and the financials.
There was also a strong mix of bonds in the screen, from corporate to municipals. If this broad-market selloff is being driven by the Fed's continued tapering of stimulus, then that is a bit surprising. If high-frequency trading is pulling off the bid, then this shouldn't be a shock in the least. The setup on the iShares iBoxx Investment Grade Corporate Bond Fund ETF (LQD) looks particularly compelling.
Dividend yield, beyond the bonds, is still a theme at the moment. Nearly half the list comprises various types of real estate investment trust equities, even after quite a few names were removed. There is a wide variety of REITs here, from mortgage to retail to specialty -- the latter of which is a range in itself. Of course, Realty Major iShares (ICF) is on the list as well. One of the main reasons I didn't cut the list down more than I had already done was because of the absolute strength in these charts, along with the diversity within the sector.
The individual names are worth noting, as well, since they are still showing strong charts in the wake of a market pullback. Of course, three of the names, Vale (VALE), Teck Resources (TCK), Cosan (CZZ) and America Mobil (AMX), are companies based outside of U.S., but the Stanley Black & Decker (SWJ) is one to target if looking for an upside play.