Friday was a red-number day – across the board. I have a watchlist that I update every week with all the stocks that have moderate to strong track records of gains or losses over the next several weeks. There are 187 symbols in this week's list.
And this particular time of year is rather unique – there are very few on that list that have negative seasonal patterns. Year-end rallies are common, and most quality stocks are actively traded, usually bought, by institutions this time of year.
But on Friday the whole list of 187 showed red numbers, losses, for the day – except for a handful. What caught my attention was a few of them were in the same sector. Here was an interesting pattern. Everything, including stocks with strong track records of being accumulated by institutions this time of year, were being sold, except for these stocks.
And even many stocks within that sector that ended up lower typically logged only small losses.
The sector? Trucking.
The Trucking sub-sector of the Transportation group is not a sexy segment of the market. At your holiday party, when that guy near the punch bowl is bragging about the Apple and Facebook trades he made this year, you will probably not mention you are thinking about buying some Old Dominion Freight Line stock.
But the Trucking sector is important. Strength in the stocks of that sector can indicate faith in an improving economy, because trucking will be one of the first sectors to benefit. I took a closer look at a few Trucking sector stocks that logged gains on Friday.
Knight Transportation (KNX) logged a 0.9% gain. Checking on fundamentals, it has a strong Relative Strength rating of 97, a Investor's Business Daily Composite Rating of 98, a decent 10% EPS Growth Rate, a Return on Equity of 13%, and most interestingly, an Up/Down Volume Ratio of 1.6, indicating strong accumulation.
Heartland Express (HTLD) logged a 0.8% gain, and its numbers are R/S=90, Composite=97, EPS=7%, ROE=21%, U/D=1.8.
JB Hunt (JBHT) logged a 2.0% gain on Friday, and its numbers are R/S=81, Composite=92, EPS=23%, ROE=38%, U/D=1.4.
While it would be prudent to wait until the current pullback in the market changes back to a buying mode, these, and other companies in the Trucking sector are worth investigating. They may not have the strongest seasonal patterns right now, but in general, at least the three stocks I just mentioned, have moderately strong track records of gains over the next six months.
Of course, there's much more you need to know and many more stocks you can capitalize upon each and every day. To find out more, please click on the following link: www.markettamer.com/seasonal
Copyright (C) 2014 Stock & Options Training LLC
Unless indicated otherwise, at the time of this writing, the author has no positions in any of the above-mentioned securities.
Gregg Harris is the Chief Technical Strategist at MarketTamer.com with extensive experience in the financial sector.
Gregg started out as an Engineer and brings a rigorous thinking to his financial research. Gregg's passion for finance resulted in the creation of a real-time quote system and his work has been featured nationally in publications, such as the Investment Guide magazine.
As an avid researcher, Gregg concentrates on leveraging what institutional and big money players are doing to move the market and create seasonal trend patterns. Using custom research tools, Gregg identifies stocks that are optimal for stock and options traders to exploit these trends and find the tailwinds that can propel stocks to levels that are hidden to the average trader.
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