All four indices moved higher on Wednesday and that is the first time we have experienced such a day since February 8. Three of the four opened slightly lower, but turned positive in the morning session. The Russell was the lone index that was in positive territory throughout the day and it was also the top performer with a gain of 2.38%.
The Dow gained 1.35% as the second best performer while the S&P moved up 1.14%. The Nasdaq was the only one that didn’t gain at least 1.0%, but it was oh so close with a gain of 0.99%.
Eight of the 10 sectors moved higher on the day and they were led by the energy sector once again—this time with a gain of 3.54%. The industrial sector rallied 1.89% and the financial sector jumped 1.88%.
The only two sectors that failed to move up on Wednesday were utilities (-1.17%) and consumer staples (-0.06%).
My scans turned in a second straight positive result last night with 54 bullish signals and eight bearish signals.
The barometer moved in to positive territory with a reading of 23.1. This is the first positive reading for the indicator since February 5.
I have yet another bullish trade idea for you today and this time the subject company is Avantor (NYSE: AVTR). The special chemical company appeared on the bullish list last night and it has good fundamental ratings. The EPS rating is a 69 and the SMR grade is an A.
We see how Avantor has been trending higher over the last seven months with a trend channel forming that defines the various cycles within the trend. The stock just hit the lower rail of the channel and the stochastic indicators are in oversold territory. The indicators made a bullish crossover last night. The last two times we have seen this were in late June and late October. Each of these two instances preceded sharp rallies in the stock.
Buy to open the April 25-strike calls on AVTR at $3.70 or better. These options expire on April 16, 2021. I suggest a target gain of 75% and that means the stock will need to reach $31.50. The stock peaked at $31.05 a few weeks ago, so you will want to keep an eye on that potential resistance. The upper rail of the channel will be well above $31.50 in a week or so. I recommend a stop at $26.80.
— Rick Pendergraft
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