Several stocks in the IBD 50 are testing their 50-day averages or have found support at the 21-exponential moving average. Among them are Celsius (CELH), Murphy USA (MUSA), Matador Resources (MTDR), Axonics (AXNX), ON Semiconductor (ON) and Repligen (RGEN).
If you see leading stocks get support at their 21-day line after a breakout, treat that as a good technical sign. IBD research has found that big stock market winners often pull back to or near this technical level before resuming their big climb.
And at the very least, top growth stocks should be leading their 50-day moving average higher throughout their move.
The market downturn and the comeback this week have created a series of winners and losers among the IBD 50. There haven’t been many pullbacks like this in months, but that started changing when the market weakened in August. Some are in new bases, while others are finding support above their 50-day and long-term 200-day moving average.
In this challenging market environment, knowing which stocks are about to break out and create buying opportunities is key.
Celsius, Murphy USA, Matador Are Building Support
Celsius triggered the 7%-8% loss sell rule on its latest entry but is battling back. It regained support at the 21-day exponential moving average and the stock has moved bullishly above its 50-day line as well. The relative strength line continues to rise to new highs.
The maker of fitness beverages is ranked No. 1 in IBD’s Non-Alcoholic Beverage group, which is ranked No. 29 among 197 industry groups. It has a perfect 99 Composite Score.
Convenience store and gasoline retailer Murphy USA has been trading in a tight pattern for six weeks since it reported earnings on July 27 that easily topped consensus views. It had previously broke out of a consolidation pattern with a buy point of 262.68. It is trading above its 50-day line and holding support at its 21-day line.
Oil company Matador Resources is back near its buy point which it hit on Aug. 11. Since then it fell into a sell zone and has struggled back with support from its 50-day line and its 21-day line. MTDR soared 3% Friday along with most oil stocks, which reacted to the rise of crude oil prices which climbed 4% to $87 a barrel.
Matador is ranked No. 1 in IBD’s Oil and Gas-Exploration and Production group, which in turn is ranked No 21.
Axonics, ON Semiconductor, Repligen Are Best Stocks To Buy
Axonics, a maker of solutions for people with overactive bladders and bowel control issues, is breaking out of a three-weeks-tight pattern after finding support at its 10-week line. This medical device stock is an IBD 50 Stock to Watch.
On Thursday, the company announced the first patient implants in Canada with the Axonics F15, the company’s newly developed sacral neuromodulation (SNM) system.
Chipmaker Onsemi is another IBD 50 stock to watch. This week showed the large-cap tech stock making a comeback from falling into its sell zone last week as the market turned sour. It is now back in its buy range after crossing its 71.35 buy point. Ranked No. 1 in IBD’s Semiconductor Makers, this stock has a solid 98 Composite Rating and a RS Rating of 95.
Biotech company Repligen is trying again to breakout from a deep base with a 262.36 handle buy point. The handle collapsed last week but this week the stock showed life again as it surged above its 50-day line.
Follow Michael Molinski on Twitter @IMmolinski
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