Stocks for tactical selling during the momentum slowdown – Oppenheimer

The S&P 500 (SP500) has failed to reach 70 level in relative strength in October, creating a slowdown in the rally recently seen, according to Oppenheimer analysts.

“This is called a momentum divergence, and as a measurement of the speed of price, indicates the rally has decelerated since July,” analysts wrote in a technical analysis note. “Some divergences are more worrisome than others, [but] with the S&P largely respecting even its closest support levels, we are not overly concerned by it.”

Analysts saw a breakpoint for the S&P 500 (SP500) at 5,650, which is now support, and it measures towards 6,200, they said.

Still, Oppenheimer analysts “remain steadfast in our advocacy for the momentum factor at this stage of the bull cycle, and are therefore encouraged the factor reached a new relative high last week.”

They said investors should be buying high-momentum when the market corrects, and selling low-momentum as the market rallies.

The following are tactical sell ideas with low momentum:

• Airbnb Inc. (ABNB) – Up 0.11% year-to-date
• Archer-Daniels-Midland Co. (ADM) – Down 20.56% year-to-date
• Brunswich Corp. (BC) – Down 15.31% year-to-date
• Dolby Laboratories Inc. (DLB) – Down 15.06% year-to-date
• IDEX Corp. (IEX) – Down 5.30% year-to-date
• Lamb Weston Holdings Inc. (LW) – Down 27.85% year-to-date
• MGM Resorts International (MGM) – Down 6.67% year-to-date
• Open Text Corp. (OTEX) – Down 19.85% year-to-date
• Procore Technologies Inc. (PCOR) – Down 9.77% year-to-date
• PPG Industries Inc. (PPG) – Down 14.76% year-to-date
• SiteOne Landscape Supply Inc. (SITE) – Down 10.47% year-to-date
• Tenaries S.A. (TS) – Down 7.42% year-to-date