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Technical Analysis

3 Stocks to Ride the Momentum on in August

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Buying falling stocks in the hopes that they’ll rise in value can be a risky proposition as they could continue to mount even further losses. Instead, you can hop on the bandwagon with these three stocks that have been doing very well this year:

Shopify Inc (TSX:SHOP)(NYSE:SHOP) released its quarterly earnings today which again showed significant year-over-year growth. With another strong beat in its books, the stock looks poised to keep on rising in value. It’s already more than doubled this year and with another good quarter, there could be nothing stopping the company today. Although its ADX is around just 18, indicating momentum has been light, that’s sure to change after the earnings performance. I wouldn’t be surprised if it hits CAD$500 later this year, maybe even before the month is over.

Barrick Gold Corp (TSX:ABX)(NYSE:ABX) has soared 30% in just three months and with gold prices continuing to rise, this could be another stock for investors to keep an eye on. An ADX of more than 33 suggests there’s a lot of strong push behind the stock and with an RSI of just 50, it’s far from being overbought.

Dollarama Inc (TSX:DOL) has also done very well this year, climbing more than 40% in just six months time, recovering from a late-year sell-off that took place in 2018. With Dollarcity in Latin American markets helping Dollarama’s future growth prospects, this could be a stock that still has even more room to grow. With an ADX of 31, it too is benefiting from strong momentum lately. The big question is how much resistance it will run into at CAD$50 and if it can break through then it could take off even further.

Disclosure: The author of this article does not hold any shares of the stocks mentioned above. This article is not a substitute for financial advice and this is not intended to persuade investors to buy or sell the stock(s) mentioned. Investors are recommended to seek professional investment advice or do their own analysis before making a stock purchase.