This year's bear market has clearly ravaged stocks. But the rising number of bases, breakouts and buy zones points has investors on the hunt for new opportunities. You'll find many promising new moves in names like Enphase Energy and Wingstop highlighted in the latest update to the IBD Breakout Stocks Index, which is updated weekly.
Even new IPOs like Third Harmonic Bio and former leaders such as Netflix are in the spotlight.
The Innovator IBD Breakout Opportunities ETF, which tracks the IBD Breakout Stocks Index, reflects the nascent rebound in the market indexes.
It's a promising market uptrend, but not without challenges. Inflation, interest rates, geopolitical turmoil and the upcoming midterm elections continue to pose potential obstacles to a sustained new climb. Tuesday's sell-off is a case in point.
See Who Joins WING, ENPH And NFLX On The IBD Breakout Stocks Index
WING, THRD, ORLY Among Top Breakout Stocks
Wingstop, Third Harmonic Bio and O'Reilly Automotive represent just three of the many stocks flashing recent breakouts. But the latest economic news and speculation about the Federal Reserve's next moves have put pressure on those moves and the general market.
Joining ORLY from the auto parts retailers group, AutoZone and Genuine Parts also recently cleared new buy points and have climbed beyond their buy zones. With inflation and other factors driving consumers to repair rather than replace their cars, the auto parts retailers industry now ranks a very strong No. 4 among the 197 groups IBD tracks.
In addition to Third Harmonic Bio, Cardinal Health, Gilead Sciences and Merck make the IBD Breakout Stocks Index from the broad medical sector.
After getting boosted for several days in heavy volume, MRK stock has edged lower, retreating to the top of its buy zone.
Steel Dynamics, which tops a stock screen of Warren Buffett stocks, has also tested the top of its buy zone after breaking out on earnings last month.
Representing the energy sector, ConocoPhillips has pumped up a breakout, but has earnings due Thursday.
Bucking Tuesday's market downturn, Applied Industrial Technologies continued its surge Tuesday. The industrial motion and automation technologies leader has zoomed past last week's breakout on earnings.
Liquefied petroleum gas play Dorean LPG has followed a similar trajectory. It is now extended from an Oct. 28 breakout.
UNH, CASY, HSY Lead Stocks Testing New Buy Zones
While keeping in mind the volatility in the market, note that several names on the IBD Breakout Stocks Index remain in a buy zone.
Casey's General Stores has shot into buy range. The Midwest retailer was highlighted in this column on Oct. 26.
UnitedHealth, an IBD Stock Of The Day back in August, broke out on Halloween. But the managed care giant got spooked and has now slipped below the 553.23 entry.
Investors have also found a sweet spot for chocolate and confectionery king Hershey, featured back in August. The stock is in buy zone with earnings due Friday.
Other stocks testing fresh buy zones in this new but challenging uptrend include FirstCash, PepsiCo and J.M. Smucker.
Smart mobility firm Verra Mobility has skidded after briefly breaking out last month. And with earnings due after the close Wednesday, a yellow traffic light is called for.
ENPH, CVX, TSCO Among Next Breakout Stocks?
As the market indexes look to shake off Tuesday's drop, a large crop of stocks, including Caterpillar, Deere and Tractor Supply, continue to set up new chart patterns.
Oil stocks fitting that bill include Phillips 66.
Enphase Energy also looks to fuel a new move. ENPH stock has posted multiple heavy-volume gap-ups in recent months, pointing to strong demand. The stock made IBD's latest list of new buys by the best mutual funds.
Other stocks to watch include Graphic Packaging, LKQ, Super Micro Computer, Restaurant Brands and AmerisourceBergen — just to name a few.
Even Netflix has shown signs of life after trending decidedly downstream since November of 2021. NFLX stock has retaken its 10-week moving average after adding more than double its expected number of subscribers. In another sign of rebounding technical strength. the 50-day line for Netflix has been trending higher. Look for that benchmark line to cross back above the 200-day moving average.
IBD Breakout Opportunities ETF
The IBD Breakout Opportunities ETF from Innovator Capital Management tracks the IBD Breakout Stocks Index. As with other index ETFs, this fund allows you to invest in the entire index in addition to, or rather than, buying individual stocks. Learn more here about the ETF and Innovator funds.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
