From the Desk of Steve Strazza @Sstrazza and Alfonso Depablos @AlfCharts
Stocks are back in bear market rally mode for the second time since this summer!
Whether this is the beginning of a new bull market is something we can only know in hindsight.
Fortunately, defining the current rally appropriately is not a prerequisite for participating in it. And the latter is all we’re worried about.
We want to position ourselves in the strongest stocks from the strongest groups and use them as vehicles to benefit from the counter-trend move that’s underway.
We discussed this in more detail on today’s Strategy Session. Click here to review the recording and the chartbook.
Now, let’s dive in and check out some of our favorite setups from our Inside Scoop universe.
To read this article, you must be a member of Inside Scoop. Please login below or go to Hot Corner Profits to start your risk-free 30-day trial today.
Lost Password?
Our first setup of the day is W.R. Berkley Corp $WRB:
Mark Ellwood Brockbank, an independent director, reported a buy of $371,784 in August.
Earlier this year, the stock broke out of a large base and experienced a swift leg higher. However, since April it has been consolidating in a continuation pattern right around the 161.8% Fibonacci extension.
We expect buyers to force an upside resolution in the coming weeks and months, in the direction of the underlying trend.
On a relative basis, WRB is pressing against new highs as it emerges from a basing pattern versus the broader market.
If we’re above 68, we can own WRB with a 2-4 month target of 92.
Next, we have a $1.7B regional bank, TriCo Bancshares $TCBK:
In a Form 4 filed in September, director Anthony L. Leggio revealed the acquisition of 2,700 shares, equivalent to $123,658.
TCBK has been basing since 2021. Price is currently knocking on the door to new highs.
If and when buyers absorb the overhead supply at the upper bounds of the range around 51.60, we want to be long with a measured target of 65.75 over the next 2-4 months.
Last but not least, we have Akero Therapeutics $AKRO:
In June, Pfizer $PFE filed a 13G revealing an initial stake of 6.70%.
The stock has quadrupled since then, taking out the 2020 peak and reaching new all-time highs just last week.
While we anticipate some backing and filling at current levels, the breakout remains intact as long as we’re above those 2020 highs. We think this one is just getting started.
As long as we’re above 41, the risk is to the upside, and we want to be long AKRO with a target of 61.70 over the next 1-3 months.
That’s The Inside Scoop!
Thanks for reading.
Click here to see the rest of the charts on our Hot List Radar.
Click here to visit the Inside Scoop Trade Ideas page.
And please let us know if you have any questions.
Allstarcharts Team