This stock is up nearly 150% in 2016 and has more room to run: Trader

As the markets continue to climb to new highs, a handful of stocks have surged more than 30 percent off their 200-day moving average — but the extreme conditions shouldn't deter investors from piling in, according to one trader.

"The implication that a stock is trading that far above its 200 day is certainly that there's been a character change, that there's been some kind of an inflection point off of what's been a sectorwide or systemic risk in that entire investment circle," Tim Seymour told CNBC's "Trading Nation" on Monday.

Semiconductor makers Nvidia and Applied Materials have surged a respective 65 and 34 percent above their long-term moving average. Meanwhile energy companies like Oneok and Southwestern Energy are trading nearly 40 percent above their 200-day moving average. And gold miner Newmont Mining is 60 percent above its 200 day.

"If I was going to be investing in one of these overbought areas, I'm going to be looking at the miners," Seymour said.

Newmont Mining, which is one of the largest components of the gold miners ETF, has surged nearly 150 percent in 2016 while the gold miners ETF, the GDX, has rallied 125 percent, and gold has broken out to multiyear highs.

"Despite the fact that it's been such a strong performer with gold's resurgence, I look at the sector and see that its coming out of a three-year bear market," said the managing partner at Triogem Asset Management. "I think they have a lot of room to run," he added.


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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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