I'm Watching These Stocks for Buyable Pullbacks
Here are four names on my watch and buy list now.
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The rotational action that boosted many smaller stocks on Tuesday is missing on Wednesday. Breadth is poor at more than two losers for each stock that is advancing. The number of stocks hitting new 12-month highs is down to 225 from over 700.
It isn’t terrible action but there isn’t much speculative interest after a good day on Tuesday. One of the most challenging aspects of trading smaller stocks in recent years is the lack of sustained momentum. The group will look good for a day or two and then turn sharply lower with no warning. It is very easy to get burned if you can’t tolerate volatility.
This choppy action is tough to trade but overall technical conditions are still bullish. The indexes need more consolidation, and it is healthier if they don’t go straight up. Of course, the volatility may be unpleasant and can shake you out but it is important to be disciplined with your trading.
I’m taking some partial profits where I have them and am looking for buyable pullbacks. One name I’m watching is Nebius (NBIS). It had a great run after a pullback on the DeepSeek news and is now pulling back in front of its earnings on Thursday morning. NBIS is a European data center, and I expect to hear about some expansion plans. The stock has little analyst coverage, which makes it more volatile.
I continue to be optimistic that we will finally see some better action in the biotechnology sector. There are a few signs of better technical action, like Xeris XERS, which broke out on Tuesday, and Bridgebio BBIO, which is recovering from a pullback off its highs.
I mentioned that Rocket Pharmaceuticals RCKT is one of my top plays for 2025, and it looks like it has now found support and is working on breaking the long downtrend line.
My game plan is to monitor positions closely and to keep hunting for some new plays. I’m unconcerned about all the bears calling for a market top. My view is that the individual stocks I’m tracking will let me know if I should be raising more cash.
At the time of publication, DePorre was long NBIS, XERS, BBIO, RCKT.
