Stockpickr) -- Traders are trickling back in from the long weekend this morning, coming into the office and onto the trading floor just as the broad market is set to test a key level for stocks. As I write, the
Dow sits just shy of 12,950 -- a mere 50 points away from the 13,000 level that's been getting so much attention for the last few days.
While 13,000 is a technical (and psychologically) significant price level, I think that the corresponding 1365 level in the
S&P 500 is a more meaningful price to watch out for; in general, the S&P is a much better proxy for the broad market than the more popular Dow is. But whichever index you're watching, the potential for U.S. stocks to move back up to their pre-recession highs is a big deal.
That sort of a move could definitely extend investors' early gains in 2012.
>>5 Big Stocks to Trade for Gains
Just how the S&P reacts to that 1,365 resistance level is going to tell us a lot about the strength of the rally that's shoved the same index up 8.24% on the year. A push through that level indicates that buyers are more willing to buy there than sellers are to take gains -- a very bullish signal for market participants. Ahead of the move, we're looking at a handful of new Rocket Stock names that could benefit from the sentiment swing.
For the uninitiated, "Rocket Stocks" are our list of companies with short-term gain catalysts and longer-term growth potential. To find them, I run a weekly quantitative screen that seeks out stocks with a combination of analyst upgrades and positive earnings surprises to identify rising analyst expectations, a bullish signal for stocks in any market. After all, where analysts' expectations are increasing, institutional cash often follows.
In the last 140 weeks, our weekly list of five plays has outperformed the S&P 500 by 83.66%.
With that, here's a look at
this week's Rocket Stocks