Recently I discussed five stocks that I believe will do well in 2020. My plan is to discuss all five periodically and provide some insight into how I am trading them.
The whole purpose of naming the five stocks isn't to just buy and hold them but to look for ways to take advantage of the inevitable volatility that will occur as they develop. Given the broader market weakness Monday, it is a good time to take a look at them and develop some strategies.
It is particularly important to have a clear trading style when dealing with these stocks. My style is to own them in a variety of timeframes and to buy weakness and sell strength as opportunities arise. I tend to make numerous buys and sells in the stocks I favor.
Aurinia Pharmaceuticals (AUPH)
My main thesis with Aurinia is that it is a potential takeover play. There is no immediate catalyst and it is likely to drift around for a while. Key support is around $15 to $15.50.
I am looking to buy on lower volume fades to $16 or so. I don't see any reason to do anything with it right now.
The company's earnings date is not set yet.
InMode (INMD)
InMode had a nice run-up over the last couple weeks and announced a new product Monday for non-invasive "facial remodeling."
The stock is down with the market and the first level of support is at $44. I'll be looking for positive anticipation in front of earnings that are due on Feb. 18.
Datadog (DDOG)
Datadog took a hit Monday with the overall market but is trading at intraday highs after a near-perfect bounce off the 50-day simple moving average.
I am looking to add to my position in this area as I suspect that the company will post very strong numbers on Feb. 13.
Personalis (PSNL)
Personalis is drifting lower and has some support at $10 to $10.50. The next event here should be some contract news for its cancer-testing platform.
There is no earnings date set it and the stock is likely to drift lower in a poor market as it is quite thinly traded.
Tempur Sealy (TPX)
TPX is bouncing back very strongly Monday after a gap-down open and is trading up around $1.00. On Friday it announced a small accretive acquisition.
This is a conservative stock with an attractive valuation so that might be why there is some interest in it now. Earnings are set for Feb. 13 and there is a good chance the stock could break out over $90 in anticipation.
All five of these stocks are going to be jerked around by overall market conditions but they have solid stories and should come back when the market overcomes its short-term problems.
I'll be updating these five stocks as they progress. They all seem to be worth holding right now.
