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Market to snap back this week? What to buy

Traders work on the floor of the New York Stock Exchange.
Getty Images
Traders work on the floor of the New York Stock Exchange.

With the S&P 500 down more than 2 percent from its record price, a continuation of the bull market could resume because stocks appear to be oversold.

Based on statistical analysis, certain companies may lead the comeback.

"Investors have been taught with QE [quantitative easing] that you buy a short-term oversold condition," said John Kosar, director of research at Asbury Research. "When you fall into support, you buy the market."

Since reaching an all-time high of 2,135 on May 20, the S&P is near a key minor support level of 2072, according to technical analysts like Kosar.

As depicted on the chart below, Kosar explains that "the S&P is at a monthly oversold extreme that has previously coincided with every near term bottom in the US broad market index this year."