I’ve given CNBC’s Jim Cramer a hard time for being more about entertainment than real investing advice.
After all, the Mad Money host doesn’t have the best track record when it comes to big calls, as I detailed in a recent article.
But there is one thing Cramer is right about… There is always a bull market somewhere!
If you’ve watched the show, you’ve likely heard that quote before.
But how true is this in a market where the S&P 500 is down 16% from its all-time high and the Nasdaq 100 and the Russell 2000 are both down 26% from their highs?
Well, perhaps more true than you might imagine…
Bear Market Leaders
As you know if you’ve been following me lately, I’m pretty bearish on the market right now until we see meaningful signs of recovery.
Institutions are clearly reducing their stock exposure, and we’ve been seeing an increase in volume as markets have moved lower.
At a minimum, I will wait for a follow-through day and preferably several days of meaningful buying before looking for new breakouts.
However, there are a few bullish ideas on my radar right now… And they all have one thing in common…
Shipping Big Gains
What all of these stocks have in common is they’re all involved in shipping goods from point A to point B and beyond.
With global markets still dealing with the fallout from pandemic shutdowns, marine shipping remains a high-demand business as companies want and need to get their products to market as quickly as possible.
Ships are still backed up outside of ports across the world, and that’s keeping shipping costs high.
In turn, shipping companies like Diana Shipping Inc. (DSX), Star Bulk Carriers Corp. (SBLK) and Eagle Bulk Shipping Inc. (EGLE) are all reaping the benefits and setting up in a similar bullish fashion.
Take a look at the daily chart of DSX, for example…
I took a small position in this stock earlier this week, as it is setting up nicely in a tight range between about $4.50 and $5.50.
There is a clear horizontal boundary at the top of the range, which the bulls are trying to push as of this writing.
The stock’s 50-day moving average is above its 200-day moving average, which is another positive sign.
And fundamentally, analysts are forecasting a 160% earnings increase this year to $1.58 per share, which is a big number for a stock trading in the $5 range.
Then, there’s SBLK, with a chart that looks very similar…
Shares of Star Bulk Carriers are also pushing the high end of the range and look primed for a potential breakout.
The stock even set a new 52-week high yesterday at $32.44 before pulling back slightly.
Last up is EGLE, which – no surprise – also looks very similar on a daily chart…
Eagle Bulk Shipping is also consolidating nicely but admittedly looks just a bit weaker than DSX or SBLK.
As you can see, it’s still above both of its major moving averages, but the stock has actually put in a lower low after reporting earnings earlier this month.
From the post-earnings low to the current price as of this writing, however, the stock is already back up by 13% and showing its resiliency.
Earnings Upon Us
Now, speaking of earnings, it’s important to note that DSX is set to report its latest results on May 24, before the market opens.
SBLK is set to report its quarterly results on May 24, after the market closes.
I am going to see how these reports come in and how the stocks react before I make any official calls on these stocks.
But I wanted to put these ideas in front of you now to give you a heads up as to what I’m watching.
Yes, we are still taking a bearish approach to the market, but that doesn’t mean there aren’t bullish plays out there too.
So, stay tuned, and I’ll let you know if I take any further action…
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Embrace the surge,
Editor, Stock Surge Daily