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The Dow Jones ended the month of May with a 208.96 point loss during its final session, and automatically many began to suggest that it could be the beginning of a larger correction in the overall market. While these people may be correct, this bull market has shown resiliency for the better part of two years - and I still believe there is value scattered throughout the market in individual stocks. With that said, I am looking at five stocks that I think look poised to trade higher, possibly in the week ahead.

A Strong ASCO Showing to Carry Over this Week

In the last month, we have watched Bristol-Myers (NYSE:BMY) rally 16% in preparation of ASCO; as the company presents data on two trials for its drug nivolumab. While it has performed well - and has been the preferred stock leading up to ASCO - Merck (NYSE:MRK) is a stock that interests me in the week ahead.

Preliminary data for Merck's immunotherapy drug lambrolizumab showed that it reduced tumors by 38% in patients with advanced melanoma. Moreover, the FDA classified the drug as a Breakthrough Therapy last month.

Merck has been the quiet story of this year's ASCO. The stock has traded with a near 1% loss over the last month, far below that of Bristol-Myers. Bristol-Myers' drug is expected to be approved late next year - Merck's drug should be FDA approved in late 2015 - both are part of the new anti-PD1 therapeutic class that is estimated to create up to $10 billion in annual revenue.

Merck is interesting, not only because it has lagged, but also because it has scheduled an analyst meeting at ASCO. While there are several companies to do so at this year's event, a scheduled meeting usually signals that a company has something good to share with the analyst community. Thus, I'd watch Merck closely this week.

A Rapid Change in Sentiment to Continue

Last week, Amarin Corporation (NASDAQ:AMRN) saw a gain of 4% in what became a very strange four sessions. First, the stock posted large intra-day losses after a report from Summer Street questioned whether or not Vescepa's ANCHOR indication would earn an FDA approval. Much of the report surrounded a noted doctor who was quoted as saying that the FDA wouldn't approve ANCHOR without additional data.

Come to find out, the physician, Dr. Eliot Brinton, was misquoted. Furthermore, additional data on Thursday proved that Vascepa worked particularly well when used on Statin-treated patients. Therefore, what began as a bad week turned out to be a good one.

Looking ahead, Amarin is trading with a one-year loss of 35% due to a number of disappointing developments with its newly approved drug Vascepa, but it finally appears to be moving in the right direction. The company's ANCHOR study won't have an effect on sales for at least another six months, yet its success is the glue that holds Amarin's upside together.

After a year of bad news, I think Amarin is looking particularly attractive, and I am encouraged by its performance late last-week. It is a one-billion dollar company with a product that was once heralded as having blockbuster potential. Right now, I think it presents a favorable risk-to-reward ratio - and I anticipate that its rally mode will continue into this upcoming week.

There Are Still More Shorts to Cover!

SodaStream (NASDAQ:SODA) is exhibiting the same trend as it did back in 2011 - it trades with the performance of Netflix (NASDAQ:NFLX) - although now, SodaStream is much less skeptical and has far better fundamentals.

SodaStream is currently trading near 52-week highs after a one-year 110% return. The company continues to prove naysayers wrong, including 34% growth last quarter, and a near 50/50 market share between Europe and North America. The company is fairly cheap considering its growth, trading at just 20 times next year's earnings with a price/sales ratio of 2.82.

With all things considered, more than 40% of its float is still short, meaning there is still a significant amount of room for this stock to run higher on short covering. Last week it produced gains of 3.25% after pulling back to $60. Thus, the stock is now trending higher towards 52-week highs of $66.69. Historically, once this occurs a stock will attempt to test previous highs, and I think SodaStream is no different. Therefore, I expect gains in the upcoming week.

The Comeback Kid Continues to March Higher

Personally, I love Netflix's comeback story and its 260% one-year return. Last week, the stock traded flat, but did bounce from its midweek low of $210 to finish the week at $226.25. Much like SodaStream, I think this trend could continue, and that Netflix could at least test 52-week highs at $248.85.

Netflix is a cult stock, and to many, its valuation is too high. However, with such stocks, we often see valuations that far exceed a company's worth relative to fundamentals. With that said, Netflix has the potential to expand into a much larger global streaming market - its price/sales ratio of 3.30 is actually relatively small compared to other "cult stocks" like SolarCity (NASDAQ:SCTY) and its 27 times sales. Thus, Netflix might actually be one of the more attractive of these massive momentum plays in the market.

Overall, I think its 15%-20% growth is encouraging and that its margins have room to improve. Hence, I'd keep an eye on this stock, starting with next week.

Sometime Right Doesn't Makes You Right

To this day, I still believe that hedge fund manager Bill Ackman's 40-page treatise questioning every aspect of Herbalife's (NYSE:HLF) was the most well-researched outlook that I have ever seen. It wasn't too complex -- based on common sense - and it raised valid questions. However, despite my belief that he is correct with his call, Herbalife has rallied 42% in 2013, and many have forgotten about the questions raised.

The point being that sometimes in this market you will be correct in your analysis, your opinion, and will make the logical investment decision, but you will still lose money. To me, Groupon (NASDAQ:GRPN) is a Herbalife like stock. In a very trendy hyper-growth industry that is based on "staying cool," Groupon is losing momentum. Moreover, I don't believe that online coupons is an industry that will stand the test of time. I also think that it has very few barriers to entry, creating potential problems for Groupon.

Despite my personal belief, Groupon is trending higher, and it doesn't matter if I am right or wrong with my outlook. In the last month alone, the company posted better-than-expected earnings (although guidance was weak), has seen several analyst upgrades, and has seen strong institutional interest. Not to mention, the current co-CEO's statements of Groupon "eventually producing $100 billion in annual sales" hasn't hurt investor sentiment. Therefore, Groupon is on the uptrend, and on Friday appeared to trade stronger as the market sold-off. Hence, I wouldn't be shocked if that positive momentum carried over to next week, and if Groupon adds to its 60% YTD gains.

Conclusion

In previous "5 Stocks to Watch" articles, I have mainly chosen stocks that I like long-term. These have been stocks that I have watched with immense interest for weeks, months, even years at a time; thus, I am familiar with their long-term trends. In this week's issue, I wouldn't invest long-term in either Groupon or Netflix, but at this time in the market, trends matter in producing gains. In my opinion, these are all stocks that look to have a favorable trend. Since trend always determines the short-term direction of a stock, I'd watch each of these stocks closely next week - but would be sure to perform a great amount of due diligence before making any long-term investment decisions.

Disclosure: I am long AMRN, SODA. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: 5 Stocks To Watch For Gains Next Week