I'm a fan of relative strength and, even in a market that's been whipsawing back and forth, leaders emerge and you need to be vigilant in seeking them out. One such group hadn't shown relative strength in many months, but that changed in 2022 as we're now seeing absolute and relative breakouts.
Welcome back, defense industry!
Here's a 2-year daily chart that shows the group finally breaking out on an absolute basis above the October 2022 high. It's also moved to a 15-month relative high. Check this out:
There are some big winners in the industry right now. Here are 3 really nice breakouts this week:
BAESY:
This chart looks superb, but volume on the stock can be really light sometimes. Therefore, I'd prefer the next two.
NOC:
GD:
All 3 of these charts look solid to me. I expect that we'll see higher prices. When we put together our portfolios at EarningsBeats.com a few days ago, we featured one defense stock which, I believe, is better than the 3 above. In addition to breaking out on heavy volume like the other 3, this particular defense stock sports a 2.88% dividend yield and has raised its dividend every year for the last two decades. I'm featuring this defense stock on Monday in our EB Digest newsletter, which is completely FREE. There is no credit card required and you may unsubscribe at any time.
CLICK HERE to register with your name and email address and we'll get you set up to receive Monday's stock.
Happy trading!
Tom
