What's Hot and What's Not

The stock market has become very discriminating.   Even though indices are near all time highs, many stocks are not.  In fact, there are many near 52 week lows.    So here is my perspective on what's hot and what's not.

Hot
  • FAANNG -  Facebook, Apple, Amazon, Netflix, Nvdia and Google (now Alphabet).   Nvidia, Facebook and Apple are really hot.  Amazon, Neflix and Google have cooled a little but can easily recover.
  • Priceline and Tesla - Both have pulled back from their highs, but I would still consider hot.
  • Alibaba - At all time highs with earnings coming up this week.
Not
  • Retail, especially apparel-  This sector is getting crushed, with many stocks at or near 52 week lows.   More downside risk that upside potential at this time.
  • Oil - Many stock are hitting new 52 week lows.
  • Materials - Weak and getting weaker.
Being a contrarian isn't working now.  Stocks in the Not category can't find a bottom and  keep going down.   Buying momentum is working.  Even if stocks in the Hot category correct, they quickly  rebound to new highs. 

So for me right now it's either go hot or stay in cash.

Disclosure:  We own the following stocks:  Facebook, Apple, Amazon, Netflix, Google (Alphabet), Priceline and Tesla.  Unfortunately, we own a bunch of oil, retail and materials stocks too.

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This is not financial or investing advice. Please consult a professional advisor.

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