The indices were mixed again on Monday with three moving higher and one moving lower. Once again it was the Nasdaq that lost ground and this time it lost 0.39%.
The Dow and Russell were both in positive territory for the entire day and they finished with gains of 1.30% and 0.99%, respectively. The S&P moved up 0.27% on the day.
Six of the 10 sectors moved higher on Monday, but there were two that really stood out for their performances.The energy sector jumped 3.07% and the industrial sector gained 2.46%. Those gains were well above the others.
The healthcare sector fell 0.34% and that was the worst performance of the day. The communication services sector was close behind with a loss of 0.33%.
My scans were a little less negative on Monday than they were on Friday, but not by much. There were 41 stocks on the bearish list and nine on the bullish list.
The barometer fell once again, this time dropping to -34.3 from -27.7.
I wasn’t crazy about any of the stocks on the bullish list or the bearish list last night. There was one stock on the bullish list that I liked the chart and the fundamentals, but the option pricing didn’t make sense. Because I didn’t like anything on the two lists, I went to my weekly charts and found a stock I really like. Zynex (Nasdaq: ZYXI) scores a 97 on the EPS rating system and an A on the SMR grading scale.
The stock has dropped rather sharply over the past month and that has put it in oversold territory on both the daily and weekly charts. We do see how the stock has turned higher in the last few days and I look for it to move back above the 10-day moving average and start a new trend higher.
Buy to open the November 17.50-strike calls on ZYXI at $4.10 or better. These options expire on November 20. I suggest a target gain of 100% for this trade and that means the stock will need to reach $25.70. The stock was trading above $28 at the beginning of July. I recommend a stop at $16.25.
— Rick Pendergraft
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