Well, one month later from a series I had hoped to make weekly, here we are. It’s been quite the month for October, and, of course, this first week of November. I recently decided to take a look at the stocks on the S&P 500 and the NASDAQ 100 to determine which stocks have flashed buy or sell Simple Moving Average (SMA) signals in the last week. These are based on the SMA Crossover Strategy I wrote about last month. I’ve added in stocks from my personal portfolio as well as my watchlist. Running the SMA Crossover Strategy from that list of comanies, I find that 24 of them flashed SMA Buy Signals and 39 of them flashed SMA Sell Signals in the last week. Let’s go over a few examples of each.
Buy, Buy, Buy!!
The first stock on the Buy List would be Apple (AAPL) seen in Figure 1 below.
Apple stock had actually flashed a Sell Signal in my last article on the SMA Crossover Strategy back on October 2nd. After basically remaining flat for the last month, the Buy Signal finally came back. I will definitely keep an eye on this. As you can see from the beginning of 2019, the SMA Crossover Strategy has been a relatively good trading strategy for Apple.
Another interesting stock on the Buy List is The Clorox Company (CLX) seen below in Figure 2.
Clorox was one of the few companies that really didn’t see much of a hit back in March like many companies did when the initial COVID-19 shutdowns began. Fairly obvious since Clorox products were flying off the shelves at the time. Actually, if it hadn’t been for COVID, it’s like that Clorox would have remained flat as it did prior to this year. They hit their 52-week high on August 4th at $236.52 and have fallen since then flashing a Sell Signal in September and finally coming back to a Buy Signal on Friday.
I listen to several investing podcasts, and a handful of them come from the Motley Fool suite of podcasts. They sometimes talk about Sherwin-Williams (SHW) which was a steadily rising stock pre-pandemic shown below in Figure 3.
While the stock did fall back to nearly early 2019 prices back in March, it has since recovered quite nicely and has continued its trend upward. SHW stock actually flashed an SMA Sell Signal nearly two weeks ago on Tuesday, October 29th, but came back around after gapping up over 9% since then.
Of course, not everything is nice and rosy with the SMA Crossover Strategy as I’ve mentioned before. Cardinal Health (CAH) is an example of that in Figure 4 below.
This stock has been all over the place and basically flat since early 2019 as shown here. This kind of price movement is not very kind to the SMA Crossover Strategy. In most cases for this stock, if you tried following this strategy, you’d end up selling at a loss many times. That is obviously not ideal!
Other stocks that have flashed Buy Signals in the last week are Baker Hughes (BKR), CVS Health (CVS), Expedia (EXPE), Facebook (FB), Garmin (GRMN), The Hartford (HIG), Hormel Foods (HRL), Henry Schein (HSIC), Gartner (IT), Kraft Heinz (KHC), Loews (L), Lululemon (LULU), Morgan Stanley (MS), MSCI (MSCI), Nasdaq (NDAQ), Molson Coors Beverage (TAP), T-Mobile (TMUS), Take-Two Interactive (TTWO), Walgreens Boots Alliance (WBA), and Waste Management (WM). That last one actually flashed a Sell (Monday, November 2) AND a Buy Signal (Thursday, November 5) in the same week. T-Mobile also flashed both in the same week.
Sell, Sell, Sell!!
We begin the examples of stocks flashing a Sell Signal with my favorite company of all time, Advanced Micro Devices (AMD) shown in Figure 5.
This was another one of the stocks I had featured in my October 2nd article as it had flashed a Sell Signal at that time. Since then, it flashed a Buy Signal and now a Sell Signal. I’m not overly worried about AMD though. I have full confidence in that company to continue to push forward. By the way, if I started working there, would I be able to say anything about the company? That would be unfortunate, but certainly not going to keep me from trying to work there.
Next up is a company whose software I should probably learn a little bit about, Salesforce (CRM).
Salesforce was relatively flat pre-Pandemic, but given the increase of work from home since March, Salesforce has really taken off hitting an all-time high back on September 1st. Since then it’s come back down a bit seemingly hitting a point to take some profits. This may be a stock that comes back and hits a Buy Signal again fairly soon…maybe in the next month so we’ll keep an eye on it.
Next up is Hewlett Packard (HPE) shown in Figure 7.
This has definitely been a “Not great, Bob!” type of stock that has not recovered at all since March. Add to that the relative flatness of the price movement, and this strategy just doesn’t work at all.
Other companies to flash SMA Sell Signals in the last week include AFLAC (AFL), AON (AON), American Express (AXP), Crown Castle (REIT), C.H. Robinson (CHRW), Cincinnati Financial (CINF), Carter’s (CRI), Delta Air Lines (DAL), D.R. Horton (DHI), Dow Inc. (DOW), Fiserv (FISV), Genuine Parts (GPC), HP Inc. (HPQ), Incyte (INCY), Intel (INTC), Coca-Cola (KO), Lennar (LEN), Mosaic (MOS), Norwegian Cruise Lines (NCLH), Oracle (ORCL), Healthpeak (PEAK), Principal Financial (PFG), PulteGroup (PHM), PVH Corporation (PVH), Robert Half International (RHI), Ralph Lauren (RL), Ross (ROST), Sysco (SYY), TJX Companies (TJX), T-Mobile (TMUS), Tractor Supply (TSCO), Ulta Beauty (ULTA), Union Pacific (UNP), Ventas (VTR), Will Towers Watson Public (WLTW), and Waste Management (WM).