It may look like the good times are here to stay — but use smaller names like CrowdStrike to gain exposure without turning to the megacap stocks in case the stock market turns sour, says trading expert Mark Minervini.
Stocks are continuing to show strength, heartened by hints (and yes, explicit signals) that the U.S. economy is set for a "soft landing." The Fed is hoping to bring inflation down without sending the economy into a deep slowdown.
Using CrowdStrike Stock To Soothe Trader Jitters
The uncertain nature of the economy presents investors with a chance to gain exposure to the market through names like CrowdStrike stock, but Mark Minervini, founder of Minervini Private Access, tells Investor's Business Daily's "Investing with IBD" podcast to keep one foot by the exit just in case.
Audio Version Of Podcast Episode
Trading with several fail-safes can help soothe trader jitters. "Always trade with a stop loss, always know when you're getting out before you get in, where you're going to cut and run," said Minervini. "The other one is always look to improve your worst-case scenario."
He says names like CrowdStrike stock are backed by solid fundamentals, and make a case to investors for exposure to the market without being too overweight into the megacaps. "You're still going to move with the market, but you might get that leverage," he said.
CrowdStrike stock currently holds a perfect IBD Composite Rating of 99 and is ranked No. 1 in IBD's Computer Software-Security industry group, according to IBD Stock Checkup.
Short-Term Potential For CrowdStrike Stock
But Minervini cautions that names like CrowdStrike stock work best as short-term plays. "The shorter your trading is in as far as duration, the more you want to be selling right after that strength and not using negative or downside sell rules," he said.
"Sentiment is like a flock of birds," said Minervini. "There's a lead group, but the whole flock really tends to gravitate around with each other."
And while it's always good to have an exit plan, the market's recent bullishness can look reassuring.
"Things look pretty good," said Minervini. "I think the best setups are yet to come."
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