This S&P 500 comeback stock could ride higher from here, traders agree

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The S&P 500 has made a major comeback.

After hitting the lows of the sell-off on March 23, the benchmark index has rocketed 21% higher.

A handful of its stocks have led the charge — MGMCapriCotyNvidia and Halliburton have all soared off their March lows.

“When you look at these names I think that it makes sense they’re rolling off the lows. If you’re a long-term investor, I think it makes sense to get into them here,” Danielle Shay, director of options at Simpler Trading, told CNBC’s “Trading Nation” on Tuesday.

Only one has the best chance of outperforming from a trading perspective, though, she adds.

“I love the relative strength that we’ve seen with Nvidia. The chipmakers are incredibly strong, and it has an upcoming earnings report, and I think it’s going to continue trading higher into that report,” said Shay.

Nvidia is set to report earnings on May 7. Analysts surveyed by FactSet anticipate 90% earnings growth in its first quarter.

Todd Gordon, managing director of Ascent Wealth Partners, agrees with Shay, noting that Nvidia has both fundamental and technical tailwinds.

“It’s a leader in AI, data centers, all sorts, self-driving cars, cloud, gaming. It’s just unbelievable. From a technical point of view, [it’s] another stock that here in the weekly is holding the 50- and 200-week moving average. So, really good relative strength,” Gordon said during the same segment.

Gordon says the stock is now bumping up against a $300 target. On the daily chart, it is also holding above its 50- and 200-day moving average, he notes.

“There’s a big open interest at the $300 call strike next month in the May options, so watch that should  this market stabilize,” Gordon added.

Nvidia shares hit a low of $180.68 on March 18. Since then, they have risen 43%.

 

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