Stocks in the Spolitght Stocks to watch

The markets finished the second week of the new year off a little but not that much. The worst performance was the DJT which is something were getting used to followed by the RUT another one we're getting used to. Both are off close to a -5% while the rest of the indices are mostly off under 1%.

This is telling us we can expect to continue seeing new record highs on most of the indices, 6 last week, but what we want to see is for the Dow Jones transportation's and the Russell 2002 to show up for the party.

Since I am bullish and what this means to me would be that the markets still have quite a bit of room to climb with opportunities to enter the market on pullbacks. The VL & NASDAQ are less than a 1% away followed by the spread little over 1% of reaching a new record high.

Unfortunately, the RUT still more than -4% from its previous record high, but this -4% could be wiped out pretty easy. Another thing that it is telling us is there are still many good values in the big OTC stocks, meaning all we have to do is our homework and we should be able to find some pretty good buys.

We can continue to give credit to the tax cuts, as it has given more money to corporations and the people that buy their products. It turns out our biggest problem in front of this may be the fact that we don't have enough workers to cover all the job openings, a totally different problem than we've come accustomed to under Obama.

Still, with so many stocks trading so near the high I find myself not wanting to lean toward any specific industry, but more-so into individual stocks that seem to be offering us new stories and new products. I feel this is where we will make our greatest percentage return.

There's just no reasons out there for this market to have a big correction at this point in time because of the continued growing economy I don't see anything in the first quarter that would take the marked down too far.

The two problems that could've affected us a fair amount would be China & Iran, but it appears China is getting ready to do some deals with the good old USA. This can only be positive for the US market's as it will help put more money in the pockets of Americans, especially the farmers.

When I say a stock is to high to buy it does not mean that we should sell it. If it's been doing well in the market than hang on because it will probably continue to climb. All it really means is, it's the wrong time to sell, but also it is another way of saying, if we are worried, we might have to look somewhere else for the bigger bargain.

The world economy is so complex and so confused that I still don't feel metals are a safe place to go. A lot of people, and a lot of nations, tend to move into the precious metals when things get hard to predict, but if the economy continues to grow you will find much new money coming into the market's and much of that money will come out of the metals.

Plus metals are trading near their higher end of the trading range meaning it would be a lot easier to fall then to continue climbing, therefore avoid the metals at this point in time.

Since I am a technician first, the fundamentals will always take a backseat while the trend will stay in the front. Due to the recent strong attempts to take the market lower and the resistance that it ran into it only makes me more bullish for the near-term.

The bottom line is the indices are setting new highs with the Dow Jones Industrial average reaching a new high on almost every up day over the past few weeks. If I am correct we should continue to buy on weakness.

Look at the secondaries like Intel Corp., because it has a low PE (has been climbing lately), and Fonar Corp., because it has a ridiculously low PE and a top selection, if you want to buy and hold.

I have a rule: As long as corporate earnings are strong and interest rates are low the markets cannot
become bearish. This only happens with poor corporate earnings and climbing interest rates.

I would use this current market strength as a reason to pick up a quality company with a low PE, of which I recommended Fonar Corp. FONR $20.01 (PE is 9.05), up over the last week, but I would hold off on Intel Corp. INTC $60.10 (PE is 13.99), due to up strong recently, making the stock to high to buy. I believe having an opportunity to own stocks like these may not come again for quite some time and I also feel there's little downside.

My long-term pick, a stock that could be held for the next 20 years, would be Apple Inc. although the stock climbed near the $300 mark it's the kind of company that won't stop growing. They've got a lot of money and are very creative and now they're going to be, factor in the television market.

There is no stopping the stock, up from $150 in the last year moving over $300 mark this past week. There are no real resistance or support levels available work with but in this market possibly a 10% correction in the stock would be the time to move in, or something in the area of $260.

My near-term pick, is a stock that hasn't been trading that long and currently is near the 52 week low. The name of the stock cbdMD. Inc., It trades on the NASDAQ and the symbol is YCBD. The current price is about a $1.05 and the 52 week low is $1. The company just announced they will be doing a $6 million secondary offering or 6 million shares at one dollar.

I say jump on this stock right now I will bring more of this company you soon but don't wait for me
with 6 million new dollars the stock of the climb over the previous 7.24 52 week high,. a hell of a move from here.

I'm betting that the OTC stocks will outperform the blue chips once the OTC indices reaching new highs for the year. I believe we are just starting to see major benefits from corporate tax breaks and this should continue throughout the year and into the next.

Looking at the chart above we can see that the current discount to the 52-week high is at -7.86. On 12/3/18 the discount was setting at -8.81% and 2 weeks later, 12/24/18, it had fallen to -22.46% but it climbed back up on 2/26/19, two months after hitting the bottom, then turned back up further reaching -8.81% again and has been bouncing around since. Remember this is the average of all 30 Dow Industrial stock's.

The DOW 30 off -133.13 (-0.46%) on the year and -133.13 (-0.46%) from the new 52 week high.

Another stock I like his Walmart (WMT) $115.58, because it has become much more aggressive and it seems to be attacking Amazon. No matter how big Amazon is, Walmart is in a position to not only catch Amazon, but if they're smart they can overtake it. This is because each and every store is a warehouse making it possible to deliver things to you in just a few hours from the time you order, either online or on the phone. My only negative is a PE of 23.12 but this is near the average of the S&P 500. Although the stock has been setting new 52-week highs often, possibly a best entry would be on a decent pullback in the markets.

Also, another best bet would be the lower-priced arena and you certainly need to use caution there, but there are some excellent opportunities if you just do the homework.

Wishing you a Happy New Year. Wishing you the best! JR