On Monday, Tesla Inc. (Nasdaq: TSLA) hit its 52-week high – just one week after becoming the most valuable automaker in America.
It's not the only one, though. There are actually 126 stocks trading at or near all-time highs.
But don't worry about figuring out which ones to add to your portfolio right now…
Buying High to Sell Higher
Before we get started, I want to spend a minute on the misconception that buying stocks at 52-week highs is something you should avoid (which is based on the idea that they have nowhere to go but down in price). This simply isn't true. And too often, this myth is exactly why investors miss out on enormous growth and profit opportunities. In fact, when investors buy these stocks (and continue buying), it only strengthens the stock, propelling it higher – even after a pullback.
That's the basis behind the adage "buy high and sell higher," made popular by Investor's Business Daily editor William O'Neil. O'Neil revealed historically proven data that stocks trading at their highs have momentum on their side, and a new high can beget more upward price action. This could be due to folks rushing in because they don't want to miss out on the stock, or it could be due to a belief in the strength of the stock. But the bottom line is new money will continue to drive stocks at their 52-week highs even higher.
So it's important to not let the fear of buying high stand in the way of easy profits.
Now, you can track stocks trading at 52-week highs on virtually any financial website, such as Barchart.com (which provides real-time and delayed intraday stock and commodities price action). I use my own proprietary tools to search for stocks that are at, near, or making new 52-week highs. And here's what my scan revealed as of the time of writing:
As you you can see, there are actually 10 stocks on this list instead of eight. But when I looked through the charts to see if any of these stocks aren't actually worth pursuing, Mobileye NV (NYSE: MBLY) popped up as a company that's been or is about to be acquired:
And sure enough, Intel Corp. (Nasdaq: INTC) is in the process of trying to buy the Israeli application software company.
The other one I determined was a stock not worth pursuing is Cirrus Logic Inc. (Nasdaq: CRUS).
As you can see in the price chart below, CRUS made a new high but then reversed and closed lower. And any stock that makes a bearish reversal after a new high day is one you'll want to stay away from.
So these are your top eight stocks to watch right now:
About the Author
Tom Gentile is one of the world's foremost authorities on stock, futures and options trading.
With more than 25 years' experience trading stocks, futures, and options, Tom's style of trading systems and strategies are designed to help individual investors propel themselves past 99 percent of the trading crowd.