Dow Jones Futures Jump, But 2019 Stock Market Rally Missing Top Stocks Breaking Out

Dow Jones futures rose modestly Sunday evening, along with S&P 500 futures and Nasdaq futures. The 2019 stock market rally showed further strength Friday, but top stocks aren’t breaking out yet. Many top stocks are setting up. Merck stock, Pfizer stock, Eli Lilly stock, Regeneron stock and Vertex stock are near buy points ahead of a key healthcare conference.


Merck (MRK) and Pfizer (PFE) are Dow Jones stocks. In fact, they were the top Dow Jones performers in 2018. Merck stock has a strong 94 IBD Composite Rating out of a possible 99. Pfizer stock has a 91 Composite Rating. Vertex Pharmaceuticals (VRTX) has a 98 CR, Regeneron Pharmaceuticals (REGN) a 97 CR and Eli Lilly (LLY) a 94.

Investors should wait for top stocks to clear buy points before taking a position. One option is to use ETFs to take part in the stock market rally.

Dow Jones Futures Today

Dow Jones futures rose 0.4% vs. fair value. S&P 500 futures climbed 0.3%. Nasdaq 100 futures advanced 0.35%. Remember that Dow futures and other overnight action don’t necessarily translate in actual trading in the next regular session.

2019 Stock Market Rally

The 2019 stock market rally signaled strength on Friday after Fed Chairman Jerome Powell said he will be flexible, patient and listen to financial markets. A strong U.S. jobs report and positive China headlines helped buoy sentiment too. The Dow Jones soared 3.3%, the S&P 500 index 3.4% and the Nasdaq composite 4.3%.

It’s always a good idea to read IBD’s The Big Picture to stay in sync with the major market averages and leading stocks. The latest Big Picture column is especially important.

The stock market rally is seven days old. The prior two Nasdaq rallies lasted seven and eight sessions, respectively, before the stock market correction took hold again. So it’s important for the major indexes and leading stocks to continue to show strength.

The jobs report and Chairman Powell brought some certainty. But the partial government shutdown continues, with more services and functions affected. New face-to-face China trade talks begin Monday in Beijing.

Top Stocks Aren’t In Buy Zones

It’s not surprising that top stocks aren’t breaking out yet. The stock market correction — a bear market for the Nasdaq and S&P 500 index — heavily damaged stocks. Even many top stocks with relative strength lines at record highs were trading well below highs and key support levels.

But over the next several days, you’d like to see top stocks break out and provide buying opportunities.

Merck stock is in a flat base, above its 50-day line, 4% below an 80.29 buy point, Marketsmith analysis shows. Pfizer stock is in a flat base, slightly below its 50-day, 7% from a 46.57 entry. Eli Lilly stock is a flat base within a base-on-base pattern, 4% below the buy point. Regeneron stock is in a four-month bottoming base, 4% off the buy point. Vertex stock, which just reclaimed its 50-day and 200-day, is 8% below a buy point in a double-bottom pattern.

Merck, Pfizer, Regeneron and Vertex Pharmaceuticals present at the J.P. Morgan Healthcare Conference on Monday. Eli Lilly holds an event Tuesday.

There are plenty of other top stocks setting up. You can find many in the IBD 50 and other IBD stock lists as well as in many IBD articles. Marketsmith and IBD Leaderboard are premium services to help you find top stocks.

ETF Market Strategy

Investors should wait to buy specific top stocks until they break out. But you could consider buying an ETF.

Buying an ETF can be a stop-gap measure to participate in the 2019 stock market rally before you finding specific stocks hitting buy zones. But IBD’s ETF Market Strategy can be way to invest broadly via market timing.

Possible ETFs include Invesco QQQ (QQQ), which tracks the Nasdaq 100, the SPDR S&P 500 Trust (SPY) or the Innovator IBD 50 Fund (FFTY).


Top Stocks Near Buy Zones: 5 IBD 50 Stocks That Could Take Off If Bulls Charge Ahead

The Big Picture: S&P 500, Dow Jones Deliver The Goods

As Market Runs, These 3 Stocks Could Pump Up Your Watch List

Not Every Stock Market Follow-Through Works: 2 Red Flags To Watch For

Dow Jones Futures: This Often Happens After A Sharp Stock Market Correction

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Originally posted 2019-09-19 23:30:14.


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