3 Stocks About to Rally

These stocks are seeing a shift in their technical trends that could lead to big profits.
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By Chris Johnson and Jon Lewis of InvestorPlace

The market has spent the last few weeks retracing lower as economic concerns have combined with overhead technical resistance to cause investors to question whether they want to continue holding stocks.

Despite the overall weakness in the market, there are some stocks that have been undergoing a transition from short-term bears to bulls as the result of some short-term targeted buying. Keeping an eye on the list of stocks that have seen a shift in their respective technical trends will give you a leg up on identifying the stocks that will likely be relative strength leaders for the next rally.According to our proprietary technical models, there are 13 companies in the S&P 500 transitioning from short-term bearish to short-tem bullish trends as of Friday. Of these 13, we've identified the following three stocks as prime candidates to deliver a pop to your portfolio.

Qualcomm (QCOM)

One of the few areas of the technology sector that has continued to see innovation, a key component of investment strength, is the wireless hardware companies. Over the last few weeks,

Qualcomm

(QCOM) - Get Report

has been able to remain above technical support at the $38 level, helping to transition the stock back into short-term bull mode.

The stock has seen a large increase in bearish bets lately, meaning that a shift into bullish mode will cause these bears to cover their shorts and turn back into buyers. We expect this action to drive the stock from $38 to $42 over the short term.

Hormel Foods (HRL)

Hormel Foods

(HRL) - Get Report

, the producers of SPAM and other meats, has been on a tear over the last year, as it has remained in a strong upward trend and been a relative strength leader.

The stock has been battling with the $44 level as resistance has slowed its progress, but that looks like it's about to change. A burst of some pessimistic activity is suggesting that the market is starting to bet against a breakout in HRL, which is often a sign that the stock is ready to advance to the next level.

We expect the stock to make a run to $46 over the next few weeks, a 5% move for short-term traders to leverage with options.

The Hershey Company (HSY)

The Hershey Company

(HSY) - Get Report

needs no introduction, although most investors have no idea just how well the chocolate icon has fared against the market over the last year.

After hitting some resistance in July, HSY has pulled back from almost $51 to $46 and is now looking to make its move again. In addition to being identified as a "transition candidate," HSY is breaking above its 20-day moving average, a trigger that many technical traders will pick up on as a bullish signal, attracting a new wave of investment dollars.

The bullish combination results in a short-term target of $52.50 for HSY, a move of more than 12%. And we're expecting this move to materialize over the next six to eight weeks.