Market Outlook This Week
First thing, the US Federal Reserve is having an interest rate decision meeting on Tuesday. The street is expecting no change. The market right now looks like its continuing a little higher for whatever reasons, but I’m still waiting for the turn to the downside, and short selling like a mad man. Have to wait for major support to break, then the test back up, to confirm it’s all sell again. Right now the risk to the downside is much more than the rewards to the upside. So if you’re going long, stop-loss is a super must in case the market reverses on your long positions. Stop-loss is always a must anyway whether you’re a day-trader with big leverage or a long term investor at full margin.
USA Europe Asia Emerging Markets
If and when USA and Europe markets start tanking again, I see the Asia markets holding up the best. So I suggest the following. Direct equity investment in Asia markets, along with ADR stocks ETF’s and funds. Also commodities and or a managed futures account would be smart with and some money in a short mutual fund also. If you like short selling, then you should already know what I’m talking about. I think that the sell time is coming pretty soon for the USA and Europe markets. It could be possibly one to two weeks away. I would not be short selling China though with their $2 Trillion in cash. I would be looking for pullbacks in the hot China India Asia markets to be buying back in. The growth story in Asia is opposite of what it is in USA and Europe right now, and I expect it to stay that way for quite some years.
USA Sector Growth
There are sectors in the USA economy that are growing jobs, so if you want to invest and trade on the buy side in the USA, check leading low debt companies in the following sectors. Health Care, companies providing to the Federal Government, Social Services, Employment Services, Education Services, and Computer Systems Design and Services. My stock pick this week is a buy on a healthcare company. I should be short selling, but it seems maybe is not the time just yet it.
Major Global Economic Reports This Week
Monday: UK House Prices. Japan Consumer Confidence. Euro-Zone Unemployment. USA Empire Index and TIC Inflows.
Tuesday: Australia Reserve Bank of Australia Meeting Minutes. France & Euro-Zone Consumer Price Index. USA Federal Open Market Committee Interest Rate Decision. USA Consumer Confidence.
Wednesday: Bank of Japan Interest Rate Decision. UK Unemployment Rate. USA Producer Price Index.
Thursday: New Zealand ANZ Consumer Confidence Index. Switzerland Trade Balance, and Industrial Production. Euro-Zone Current Account. USA Consumer Price Index and Current Account Balance.
Friday: Germany Producer Prices. Canada Consumer Price Index.
My Stock Pick This Week
Is a buy on Express Scripts, and it’s at a 52 week high. To buy long into this very possibly topping out market is crazy, but sane if you’re using stop-loss. The trend is your friend until it reverses, and it takes time for tops to form, if it’s going to. The profit margins to the upside from here are shrinking in the market now, and I recommend investing trading in the highest quality companies for liquidity if you’re going long at this cautious time. The healthcare industry is the most hiring sector in the market right now so there’s some potential share price growth there possibly. If I was short selling this week, I would short sell Owens-Illinois Ticker OI or Watts Water Technologies Ticker WTS
Market Continuing Up or Reversing?
I see the market in a very precarious position right now. Either it’s going to rollover and down to possibly test major supports or we have some continued upside. Near term I’m betting a little more upside, but not for very far and very long. One or two weeks from now, possibly it could reverse. Intermediate term I think the market is down, and long-term deep downside in my opinion. Exclude Asia from that scenario as I see Asia holding up the best if and when USA and Europe tanks. Then again, USA and Europe markets may drag down Asia as evidenced in the past but I’m betting already it’s not the case this time. That’s a dangerous statement to say “its different this time” I know. That’s why using stop-loss is smart money in any market.
Buy Long Express Scripts – Ticker ESRX
Buy Entry: 93.65 to 100.10
Take Profit Areas: 109 to 110, 122 to 124
Express Scripts Company Profile
Express Scripts, Inc. provides a range of pharmacy benefit management (NYSEMKT:PBM) services in North America. The company’s PBM services include retail network pharmacy management and retail drug card programs; home delivery pharmacy services; specialty pharmacy services; patient care contact centers; benefit plan design and consultation; drug formulary management; compliance and therapy management programs; information reporting and analysis programs; rebate programs, electronic claims processing, and drug utilization review; consumer health and drug information; bio-pharma services, including reimbursement and customized logistics solutions; medication therapy and safety through pharmacogenomics; and assistance programs for low-income patients. It also engages in the distribution of pharmaceuticals and medical supplies to providers and clinics; fertility pharmaceuticals requiring special handling or packaging; and sample units to physicians, as well as the verification of practitioner licensure, healthcare account administration, and implementation of consumer-directed healthcare solutions. It serves HMOs, health insurers, third-party administrators, employers, union-sponsored benefit plans, workers’ compensation plans, government health programs, office-based oncologists, renal dialysis clinics, ambulatory surgery centers, primary care physicians, and retina specialists. Express Scripts was founded in 1986 and is headquartered in St. Louis, Missouri.
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Disclosure: No Positions Currently. Taking Positions Based on Trade Plan Above