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Five stocks with chart patterns that say, ‘Buy!’

After a scorching start to the year, the markets have begun to cool off a bit, and investors are left wondering whether or not the recent action is just a pause in the bullish market, or if we are about to see a major market correction.

Unfortunately, there is no way to predict exactly what the market is going to do, and a lot will depend on the earnings season that will kick off on April 24 when Alcoa (AA) reports its first-quarter numbers.

The market has been incredibly strong since early November, as Wall Street reacted to the recent elections. With Donald Trump winning the White House, and republicans winning enough seats to control both houses of Congress, Wall Street assumed Trump would have an easy path to advancing his economic agenda. An agenda that promised tax reform, less regulation, and increased infrastructure spending resulted in the markets trading up to record highs, but the enthusiasm has started to waver.

After President Trump was unable to find a way to get republicans in line to repeal and replace Obamacare, the market is now questioning how he will accomplish more difficult tasks such as tax reform.

Another problem is that the market is trading with a forward P/E of around 18, versus its historic average of 15, so a lot analysts are expecting to see a sell off in order to bring the market’s overall valuation lower. This could happen, but that will depend on the strength of the upcoming earnings season, and whether or not corporate America can convince Wall Street that the higher valuation is warranted.

One way to ensure that you put your money to work in the safest way possible is to look at charts. What we are looking for are stocks that have done ok in recent weeks, and have the technical trends that support additional upside. We also want to make sure that analysts expect the stocks to move higher by comparing the stocks’ current price with the average price targets that analysts have placed on them.

The following five stocks all appear to be decent buys from a technical standpoint, and all have price targets that suggest additional upside.

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Michael Fowlkes

Michael Fowlkes is a financial writer who has been with the Fresh Brewed Media family since 2004. Over the course of his tenure with Fresh Brewed Media, he has worn many hats, including portfolio manager, options analyst, and writer. Michael received his undergraduate degree from Virginia Tech in Accounting and got his start in finance working as a stock trader for six years at Chase Investment Counsel in Charlottesville, Va.