July 8, 2020
AliExpress WW
Traders agree that one stock significantly exceeding the 200-day moving average has more opportunities to work

Traders agree that one stock significantly exceeding the 200-day moving average has more opportunities to work

AliExpress WW

A 200-day fear creeps in.

AliExpress WW

With stocks falling on Friday due to rising cases of coronavirus in some newly discovered states, stocks, most of which exceed 200-day moving averages, are increasingly at risk of a return to the average.

Stocks more than their 200-day moving averages

Stocks % above 200-day moving average
Nvidia (NVDA) 47%
PayPal Holdings (PYPL) 47%
Regeneron Pharmaceuticals (REGN) 44%
Amazon.com (AMZN) 37%
Tractor Supply Co. (TSCO) 35%
eBay (EBAY) 34%
Netflix (NFLX) 31%
Adobe (ADBE) 31%
Autodesk (ADSK) 31%
Apple (AAPL) 28%
Clorox Co. (CLX) 27%
Chipotle Mexican Grill (CMG) 25%

One share stands out from the package in terms of its ability to continue to grow, on Friday two traders agreed on CNBC Trading Nation.

“From our point of view, dynamics is not necessarily a bad thing now,” said Craig Johnson, senior technical analyst at Piper Sandler in an interview on Friday.

According to Johnson, in the case of the Chipotle Mexican Grill, it has been 37 times since stocks began public trading that they crossed the premium at 20% of the 200-day moving average. His study found that in 78% of these cases, Chipotle shares traded on average 9.9% higher over 60 trading days.

“When I go back and look at this chart, it looks like we are losing momentum,” Johnson said. “We are above our 200-day moving average. But in the end, we can just go sideways and just consolidate here. ”

“If we had a pullback, any pullback to 940 on Chipotle would be a great starting point for investors to grow and gain,” he said.

Shares of Chipotle closed on Friday by more than 1%.

Nancy Tengler, director of investment at Laffer Tengler Investments, supported the call of Chipotle.

“We accumulated in March, and we added to our assets,” she said in the same interview with the Trade Nation. “Rollback, I would absolutely intervene because I think that this has a lot more room for growth and also to go for the price.”

Tengler cited Chipotle’s recent investment in its digital platform and the Chipotlanes initiative to promote through the company as key factors in her case with the bull.

“As we said earlier, we think that the trends that existed earlier have accelerated because of Covid, and that’s why we want to keep this action,” she said. “Great balance, fundamentals in good shape, and they demonstrate that they can grow.”

Tengler added that if there are stocks that should be avoided, this is Apple.

“At Apple, we were net sellers,” she said. “If you look at it from every measurement indicator that we use, it is overrated. So yes, the basics are good. We really enjoyed it when we accumulated it in 2013. But now is the time to think from the table, because we do not think that it is sustainable. “

Disclosure: Piper Sandler is a registered market maker at Chipotle. Laffer Tengler Investments owns shares in Chipotle and Apple.



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