This is the last of three articles on the outlook for 2021.
The first article I focused on Raymond Lo (Feng Shui Master), the Year of the Metal Ox and the potential for both more disaster and better times depending upon where one looks.
The second article, I switch my focus to Cannabis, Gold, Oil, Defense and Insurance Stocks and the Fed. I also cover what we believe will be a big headline, the rise in food prices and food commodities, including water futures. I then covered the dollar, bitcoin, and the Federal Reserve’s playground.
What are some of the warning signs for 2021? Even though big tech did well in 2020, the last two months of the year they were more dragged up without any real momentum. We see the decline of big tech continuing with Microsoft (MSFT), Nvidia (NVDA) and Amazon (AMZN) all looking like sell opportunities. All are saturated, with little upside and perhaps now appearing a bit archaic compared to some of the new hotshot tech names that emerged in 2020 like Fastly (FSLY), HubSpot (HUBS), Zoom (ZM), Snowflake (SNOW), VIPS (VIPS) and Zebra Technologies (ZBRA).
Yet, another bright spot we are watching is 3D printing. 3D printing has been languishing, and forming a good base on the charts, and could rise. 3D Systems (DDD) is one way to trade that sector. We are looking for it to hold over $8 with a move over $11, possibly a reason to see it double in price.
Elon Musk said that electricity demand can double globally in the next decade. Companies like British Petroleum (BP), Royal Dutch Shell (RDS.A), Beam Global (BEEM), Nextra Energy (NEE) and Duke Energy (DUK) are some of the companies working on meeting that demand.
Climate change remains on the minds of most investors. With solar, clean energy, and electric cars having a fabulous 2020, I expect those sectors to continue in 2021 and beyond. Apple (AAPL) is new to the EV space, commenting that they will have a car (driverless) by 2024. Workhorse (WKHS) is one that could explode if it can clear $25.00. NIO, a big mover in 2020, can also continue much higher. And Nikola (NKLA), which was laden with issues in 2020, could come alive in 2021. Of course, Tesla, now in the S&P 500 faces competition. However, the stock itself, if holds around $600, it could see $1000 as the demand in Europe and China continues to grow.
Media stocks could recover after spending four years bashed as fake news. Viacom (VIAC) is one we are long and like for a move to $50. Nextstar Media Group (NXST), if it holds around $100 could also be a good buy for 2021. Not exactly media, but an old favorite is also setting up - World Wrestling Foundation (WWE) has cleared the 50-week moving average and could see a move back to around $55.
Another strong area for 2021 is in Data Collection. Datadog Inc (DDOG) has our attention.
With the move to new all-time highs in Biotechnology in 2020 (IBB), this coming year we are watching companies like Arena Pharmaceuticals (ARNA), and BlueBird Bio Inc (BLUE) both trying to base out. Another company, GI Therapeutics (GTHX) over $20 could also move up closer to $40.
Consumer sentiment is rising amidst the pandemic. We see pent-up demand for the consumer to go out and spend money, especially on travel and leisure. A stimulus package will boost the second and third-quarter GDP, possibly as high as 4-6%. But again, the pandemic under control with a reliable vaccine and more stimulus from the US government, (ECB already promises this), are the keys.
We will be watching airline, hotel chains and cruise line stocks as we get through the 1st quarter or 2021. GoGo Inc (GOGO) is a stock to watch for 2021. A monthly close over $10.15 would be a good signal.
Finally, we also expect emerging markets to stay strong, with China playing catch up. FXI compared to SPY has grossly underperformed. That ratio could shift this year as China is the second-largest economy with a huge drive to compete with the US for number 1.
Have a very Happy and Healthy New Year!
Michele 'Mish' Schneider currently serves as Director of Trading Research and Education at MarketGauge.com. She writes and produces daily market analysis in "Mish's Daily", and serves as a developer and trading mentor in several of our trading services drawing on her 30+ Years of Trading and Teaching Experience.
Mish is a former floor trader on several New York Commodity Exchanges, including Coffee, Sugar and Cocoa NYMEX and FINEX in NYC. While on the trading floor Mish also served as a market analyst for two of the largest commodity trading firms at the time - Continental Grain, and Conti-Commodities.
Mish also wrote the best-selling finance book, Plant Your Money Tree; A Guide To Growing Your Wealth.