An expert in resource and commodity stocks, Omar Ayales, editor of Gold Charts R Us, also balances his investments with selected non-commodity stocks, including this trio of stocks involved in retail and e-commerce.
It’s easy to get lost in the noise — especially as we get closer to the U.S. election. But the reality is the result of the election shouldn’t really have an impact on the stock market’s mega trend.
Long-term, the recovery from the pandemic-led collapse will continue being the primary driver. A new economic cycle is in the midst of bottoming and restarting. That will be a reality regardless of who ends up being elected.
I believe our positions are safeguarded and will thrive regardless due to upside potential from their business models. They’re companies that are worth holding through weakness.
Take Walmart (WMT) for example. The giant retailer does twice as much in gross sales as Amazon (AMZN), with similar profitability. It’s now shifting its business model from brick and mortar to online shopping, storage and distribution.
As WMT becomes more like Amazon, expect for profitability to increase, even if gross sales remain the same or even decline initially. WMT not only is an incredible growth story, it allows for a sturdy floor in the event consumer sentiment dips or the economy struggles to recover.
Moreover, the stock's chart is very bullish. The March uptrend at $130 is solid support. It’s converging with a previous resistance (April high). Keep in mind, WMT has a decade long uptrend, with support near $115. This is why I’ve placed my stops at this level and not at the March uptrend.
Spinner — our in-house trading indicator— is showing momentum favors the stock. Allow for leeway and take advantage of weakness to buy more or if you’re not yet in.
Another company that is partnering up with Walmart and helping delve into the online market is Shopify (SHOP). The company has the platform and the knowledge to bring WMT’s distribution capabilities into the tech world. Both companies working together are dynamite.
SHOP has extended its bounce from the September lows. It’s confirming bullish support above the March uptrend near $900. Keep your positions, and allow for some leeway. I’m overweight with this stock and looking to take some profits at $1300.
PayPal (PYPL) is yet another tech company with an online platform that brings businesses and customers together. It was first of its kind and its constantly looking to evolve. For a tech company, the stock's valuation is not extreme.
Technically, PYPL is very bullish above this uptrend near $180. Spinner is still bullish, suggesting momentum continues to favor PayPal for the short-term.
