6 Stocks That Defy Market Weakness

09/28/2012 6:00 am EST

Focus: STOCKS

Moby Waller

Editor, Wyatt Research

Moby Waller of BigTrends.com highlights six stocks that have held up well during periods of overall market weakness, a good sign for any stock.

We ran a screen for liquid stocks that have shown recent strength amid the recent market weakness—September 14 was the recent S&P 500 Index intra-day peak of 1474.51. These are names that are optionable shortable, with stock price over $10, average daily volume over 2 million shares, and market capitalization over $2 billion.

Finally, we added a couple of simple performance to the screen in the form of basic technical analysis indicators—stocks had to be within 5% of their 52 week high and have recently had a bullish crossover of the simple 20 and 50 day Moving Averages.

This came up with a nice short list of 6 names:

  1. CenterPoint Energy (CNP)

  2. CVS Caremark (CVS)

  3. Johnson & Johnson (JNJ)

  4. Merck (MRK)

  5. NiSource (NI)

  6. 6. Verizon (VZ)

Here is a table of the names, sorted by Year-To-Date (YTD) performance:

chart
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With the SPY up 16% YTD even after the recent pullback, these names aren't notable outperformers—in fact 3 of them have underperformed the broad market ETF this year. However, they all have outperformed during September—something to keep in mind if we experience continued broad market weakness.

NEXT: Charts of the six stocks...

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Here are quick stripped-down daily charts of these 6 big names over 2012, with 20 and 50 day simple moving averages and Williams Percent R (the BigTrends way):

Daily chart of CNP:

chart
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Daily chart of CVS:

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Daily chart of JNJ:

chart
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Daily chart of MRK:

chart
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NEXT: Daily chart of NI and VZ

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Daily chart of NI:

chart
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Daily chart of VZ:

chart
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Doing a quick further evaluation on these 6 names using a different charting platform and with different indicators, all of these stocks look fairly attractive here in my analysis –however, many are very quiet movers and won't provide a lot of day-to-day excitement. 

The 2 most attractive bullish chart setups among this group in my view are CNP and MRK, but do your own research before investing/trading in any of these names.

Moby Waller can be found at BigTrends.com.

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