Depending on where one looks, it’s been a good year for the stock market. And today, based on what we’re seeing from three trillion-dollar plus tech giants price charts, that trend is set become more friendly with the following three stocks to buy.
The blue-chip Dow Jones Industrials. It’s up 11% year-to-date and just off record highs. The tech-heavy Nasdaq is in similar position after lagging in recent months. And the broad-based, large-cap S&P 500 has gained a slightly healthier 13% in unchartered waters. Nice, right? Right.
Obviously, there’s been some good stocks to buy. Moreover, despite some episodic volatility along the way, 2021 has been a good one for investors exposing their portfolios to the world’s biggest companies.
In the Dow, American Express (NYSE:AXP) has proved its mettle by climbing more than 36% and lead the way for the venerable index. Moderna’s (NASDAQ:MRNA) 112% return is the largest for the Nasdaq. Meanwhile, Marathon Oil (NYSE:MRO) earned the top position in the S&P 500 with a gain of 102%.
The million-dollar – or rather trillion-dollar – question is whether investors can expect more good tidings in this year’s fast approaching second half? Some will caution investors about getting comfortable with inflation on the rise. An overextended helping hand from central bankers and various ratios warning the broader market is the most expensive in history are other popular worries.
I can appreciate those concerns. They’re are not the end all, say all either.
It’s also valuable to understand the influence of the largest of large-cap stocks and more importantly, the market’s tiny universe of ginormous trillion-dollar plus technology giants. And following a challenging period of relative weakness, three of those select names are now offering investors constructive-looking price charts and in turn, stocks to buy with increased chance for success.
Stocks to Buy: Apple (AAPL)
Source: Charts by TradingView
The first of our stocks to buy are shares of Apple. The progressively diversified tech giant and world’s largest company maintains a valuation of $2.23 trillion. It’s a first and the only trillion-dollar stock to have claimed a market cap north of $2 billion. It’s significant to say the least, but biggest days may be yet to come.
Today, the price chart suggests AAPL stock’s enviable position is ready to grow even more valuable for today’s investors. Technically and as the illustrated weekly chart reveals, shares are just now breaking above pattern triangle resistance within a larger, slower developing uptrend.
With the triangle breakout occurring closer to channel support, there’s still significant room for shares to rally before overhead resistance comes into play. And with stochastics trending nicely in neutral territory, AAPL is a certain stock to buy right here, right now.
For this stock to buy and to make AAPL a more durable core position, I’d start with an August $125 married put combination with the intention of collaring shares as an anticipated rally unfolds.
Source: Charts by TradingView
Amazon is the next of our stocks to buy. The tech giant’s essential and non-essential goods and services have been a godsend to consumers and businesses alike during the pandemic. But that’s only solidified AMZN’s tendrils within our lives and irrespective of Covid-19 in the months ahead.
For investors, the better news is Amazon’s $1.76 trillion market cap looks even healthier as a stock to buy based on the price chart.
Technically, Amazon shares have been consolidating for the better part of 11 months. It’s been volatile at times. And admittedly, AMZN has failed one or more prior attempts to rid itself of the price congestion. But shares are now setting up in a second, slightly-flawed handle consolidation within the stock’s larger double-bottom corrective base.
Along with nice volume characteristics inside the handle and stochastics supporting a nearby pattern breakout, this stock to buy looks poised to enter an even more elite $2 trillion-dollar club.
My suggestion is to allow AMZN shares to breakout. Then make this a stock to buy a stronger purchase with a September $3700/$4000 bull call spread.
Stocks to Buy: Microsoft (MSFT)
Source: Charts by TradingView
The last of our stocks to buy are shares of Microsoft. The market’s second largest trillion-dollar plus company is a whisker away from being the second stock to break above the $2 trillion barrier. And if today’s price chart has any say in those matters, that obstacle is about to be cleared and pave the way to big profits for MSFT bulls.
This week MSFT has broken above pattern cup resistance to new highs. Bullishly, the price action has also reaffirmed a smaller up-channel with this stock to buy’s larger uptrend formed over the last eighteen months.
Coupled with stochastics trending supportively in neutral territory, the Microsoft price action is undoubtedly even friendlier for investors interested in locating stocks to buy. Bottom line though, it’s smart business to ensure this match made in heaven doesn’t turn sour like Bill Gates’ relationship.
As much, I’d advise a prenup of sorts and go with a partially-hedged collar. One favored combination that’s caught our eye sells the Weeklys ’30 July $280 call and simultaneously purchases a $260/$240 bear put spread along with purchasing this stock to buy.
On the date of publication, Chris Tyler did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris Tyler is a former floor-based, derivatives market maker on the American and Pacific exchanges. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits.