In some market the best approach is to trade the indices, and in some markets the best approach is to trade individual stocks. The current market favors stock pickers. The indices have been trading flat with a positive bias. The S&P 500 has been in a seven point range for four days now.
When the indices are acting like this the focus turns to individual stocks that are moving and offer opportunity. There are good pockets of momentum as well as some January effect plays developing.
This morning I bought both Amarin (AMRN) and Minerva Neurosciences (NERV) on negative news and both have bounced well. January effect plays SmileDirect (SDC) and Twitter (TWTR) are showing some life. Momentum plays Enphase (ENPH) , Ping Identity (PING) , Axsome Therapeutics (AXSM) , and Recro Pharma (REPH) are strong.
The indices may be comatose but there is some very good trading in individual stocks. Don't let anticipatory bearishness prevent you from looking for strong action. Focus on the trees, not the forest.
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Optimism over changes in the trajectory of the outbreak and a fear of missing out helped buying this week, but next week we'll see more on the economic damage caused by closing the economy.
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