NEW YORK (TheStreet) -- Here are a few safe bets in this crazy market.
1. Caterpillar, a heavy equipment maker, traded positive on Wednesday, up .72% to $104.62 per share.
Wednesday's range: 103.43 - 104.66
52-week range: 80.86 - 107.40
Wednesday's volume: 3,393,310
Three-month average volume: 5,464,620
Caterpillar is in a good rally, and so pull up the back hoe and load up on the pullback. The stock has been in an uptrend since November, up almost 30%.
Over the last few days, Caterpillar had a minor pullback, going down to the 20-day simple moving average. On Wednesday, shares crossed back over the t-line (t-line=eight-day exponential moving average) and formed a bullish hammer signal, which triggered a buy signal.As usual, we'll need to see some follow-through today, but Caterpillar is a really safe bet in this choppy market.
Caterpillar reported great earnings on April 23, gapped up and then traded to its 52-week high. Investors took profits on the days that followed earnings. Now, it's bounced off the 20, and is back on the rise. I'd set a stop at about $102.56, and target the top of the current trading channel to start, then add to the position on the pullback. Stay long until you see a confirmed sell signal, or a close below the t-line.
2. Next, let's look at Iconix, a brand-management company.
Iconix traded positive on Wednesday, closing up 0.58% to $41.97 per share.
Wednesday's range: 41.37 - 42.03
52-week range: 27.90 - 43.34
Wednesday's volume: 673,537
Three-month average volume: 595,152
Iconix has been in an uptrend for the last few years, up almost 190% since June 2012. Iconix reported earnings on April 30 and had a big day, trading up almost 7%. The following days, shares consolidated back to the t-line, like charts are supposed to do. The chart is forming a bullish flag signal now, and so watch for a breakout in the next few days. Plus, yesterday's candlestick is a combination of a bullish hammer and a bullish harami signal. All signs for a buy.
I'd set a stop just below the open of the candle formed on April 30 at $41. The only real resistance is at the 20-year high of $43.34. Stay long until you see a confirmed sell signal. In my opinion, there needs to be a definitive sell signal to exit this trade.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV