This column was originally published on RealMoney on Aug. 26 at 11:09 a.m. EDT. It's being republished as a bonus for TheStreet.com readers.During a choppy, trendless market, finding stocks to buy can be tricky. This is simply because most stocks trade in sync with the market, so an erratic market makes for erratic stock prices.
S&P 400The $MID hit an all-time high just a few weeks ago. That's right, not a 52-week high, an all-time high, which is certainly strong relative to the rest of the market. The index has come in off its high, but not by much. I'd say 700 has a decent chance to hold as support, but even if it fails, the breakout level is down only another 25 points. None of the secondary indicators are negatively diverging, so the MidCap Index looks good to me. The typical definition of a mid-cap stock is that the underlying company has a market capitalization of between $1 billion and $5 billion. So now let's look at four stocks that fill the bill.
SandiskAfter the stock gapped higher on a strong earnings report last month, the bulls have never really rested. The recent mild pullback is just further evidence of the buying interest. After a 25% run-up in the last month, there has been precious little profit-taking. The stock looks like it moves higher from here, but I'd keep a loose stop on it. After all, the market can be fickle.
HarrisHarris recently broke out above the $35 level after having failed for the past several months. There has been no real chance to get in since then, and the secondary indicators all look strong, confirming the price action. After more than eight months of consolidation, this stock looks like it has room to run.
PlexusOver the past 15 months, the bulls have been buying the stock all the way up to $15. But that's as high as they've gone, because there have been plenty of sellers at $15. But it looks like the selling is pretty much over, and a bottom has finally been completed. I'd pick up some stock here, with a stop at around $14.
Pioneer Natural ResourcesPioneer Natural Resources has also broken above multimonth consolidation. The relative strength index (RSI) has been consistently above the midline for years, signaling a persistently strong stock. Similarly, the accumulation-distribution line continues to move higher. So Pioneer looks good now, and I suspect it will get even better if the broader market starts moving higher. Be careful out there. P.S. from TheStreet.com Editor-in-Chief, Dave Morrow:
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