Look for your spots of equity green today that stand out like a flower on the baseball diamond. I'm not referring to sectors such as utilities or alternative asset classes like bonds. I'm looking at specific names such as Gilead Sciences (GILD) , Celgene (CELG) , or Merck (MRK) that are finding ways to be green.
Merck has been in a tight channel between $62 and $64, and while I like it longer-term, I'm not too excited now. On the other hand, Gilead and Celgene are very intriguing reversals this morning. Red openings found green quickly and they've been plugging away higher. I think both stocks will rise another quick 2%-3% in the next few days, and I'm willing to take small positions in these on the long side, committing 2% to 4% of the portfolio to each. These are shorter term in nature, but every trader has their own risk tolerance, so I would scale it as 2% for moderate, 3% for moderate aggressive, and 4% for aggressive.
Walmart (WMT) would be my retail play, although I could easily justify expanding to include Target (TGT) and Action Alerts PLUS holding Costco (COST) to spread the risk a bit. Buy all three in smaller sizes rather than only one. The trio will move together, but this helps mitigate some single-stock risk. Again, these haven't been winners, running in a similar vein as Gilead and Celgene, but it gives us an idea of the pattern we're seeing today.
Want another example? Buffalo Wild Wings (BWLD) was a stock I was bearish on within the past two months, but the short-side money has been made. The market isn't going away from the former losers today. They are buying some, covering some, or simply ignoring them to beat down recent momentum. I wouldn't call it sector rotation. It borders more on apathy or risk-reward. The risk is lower and those still holding the above beaten-down name simply don't care to sell anymore.
This is where I'm dipping a toe this morning. Solid companies showing some life.