Market Overview

After Pullback, Buy Defense Stocks

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By Jeff Pierce

Defense stocks look very bullish but are somewhat overstretched and could use a pullback to set up long entries in the stocks mentioned below. This sector has been on fire since April, but after a measured move out of the June consolidation I can't see this sector moving too much higher as it seems to be running out of gas.

The RSI on a weekly chart (not shown below) is so strong and often serves as a warm-up for a bigger move that is coming. I don't have a problem chasing stocks but I'm not going to chase these as they are so overbought. Right now they're on a watchlist for when/if they pull back I'll get interested in them again.

 

dn

 

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The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

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