Which Megatrends Have The Hottest Trending Stocks?

When looking for stocks that will continue to perform in 2021, we can look at the megatrends that will continue to grow considering the pandemic will be in the rear-view mirror.

On top of the list of trends is blockchain technology-and alternative currency.

With bitcoin above 52k and stocks like Riot Blockchain (RIOT), Canaan (CAN), MicroStrategy (MSTR), PayPal (PYPL), Microsoft (MSFT) and others jumping on the blockchain bandwagon, this trend will continue to change the landscape.

In almost every industry, having a system that is transparent and as a decentralized database where all transactions are stored, many industries could benefit from blockchain.

Not controlled by a central authority, its popularity and usefulness will grow.

Data collection also continues to grow.

Although it overlaps with blockchain technology, real-time processing using the cloud and digital channels make data collecting much more insightful and useful.

The hybrid cloud combines a private and public cloud which makes companies feel more secure.

Amazon and Microsoft are 2 that offer these types of services.

Large organizations will be buying and selling more data as time goes on.

This is already a huge trend in China.

Other notable companies in this space include Datadog (DDOG), Zendesk (ZEN), PayPal, and Cloudflare (NET).

However, while these companies are in megatrend territory, technical analysis is critical as all these stocks have dropped 20-40% from their highs.

If the rates hold steady as the cost of capital rises with yields, then these could start moving up again.

It would also behoove investors to look at the 200-day moving averages on most of these names as the risk point though a break below could get costly.

Another megatrend is alternative energy and EVs.

Because of this, I am watching electricity distribution very carefully.

With predictions of demand expected to double at least, finding companies that are working on distributing electricity is another big area to watch.

To make it simple, there are ETFs you can trade.

One for example is Dynamic Building and Construction (PKB), sitting at new all-time highs.

First trust Nasdaq clean edge (GRID) is another ETF which is consolidating, looking ready to go higher.

A stock called Emcor (EME) is also rocketing to new highs.

These are outperforming and should continue to do so.

With the rotation into value and domestic US sectors like transportation, small caps and retail, fundamentally, there has been a shift from growth to value.

What is interesting is that before the pandemic the economy was holding steady at around 3.5% GDP but not really growing.

This is a big reason tech did so much better than the small caps or transportation sector. Also value stocks were well under pressure.

Now, post pandemic, with this recent move up in value, the economy must continue to grow beyond pre pandemic levels. What could help are 2 major reforms, an Infrastructure package and Cannabis legalization.

That is why looking at stocks in both spaces-like Tilray or MJ the ETF and the Transportation ETF (IYT) and some names in that basket are also areas we expect to outperform.

S&P 500 (SPY392-394 resistance area.

Russell 2000 (IWMlots of resistance from 224-230.

Dow (DIAneeds clear and stay over 320.

Nasdaq (QQQ) 312.67 the 10-DMA

KRE (Regional Banks) Held over the10-DMA 66.64.

SMH (Semiconductors) 216 support. 235 resistance.

IYT (Transportation) 240 new support.

IBB (Biotechnology main support the 200-DMA at 143.31

XRT (Retail) 93.48 next resistance to clear.

Volatility Index (VXX) 14.44 recent low to hold.

Junk Bonds (JNK) 107.18 200-WMA

LQD (iShs iBoxx $Inv Gd Cor Bd ETF) Watching 128.53 as new support.

IYR (Real Estate) Held the 10-DMA at 87.30

XLU (Utilities) Needs to hold 61.07 as new support.

GLD (Gold Trust) Doji day. Watching to clear the 10-DMA at 24.56

SLV (Silver) 50-DMA at 24.57

VBK (Small Cap Growth ETF) 277.88 next. 255.23 new support.

UGA (US Gas Fund) Showing consolidation near recent highs.  33.30 to clear.

TLT (iShares 20+ Year Treasuries) 140 to clear and hold.

USD (Dollar) 91.60 new support. Resistance 92.89

EZA (South Africa) 49.55 resistance. Support 45.97

EWW (Mexico) 40.20 support.  42.67 resistance.

MJ (Alternative Harvest ETF) Flirting with the 10-DMA at 22.49

WEAT (Teucrium Wheat Fund) Support 6.15

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