The best-performing Dow stocks this year have more room to run in 2021, traders say

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A few Dow stocks made the naughty and nice list this year. Our traders pick out their favorites for 2021.

Piper Sandler chief market technician Craig Johnson and Simpler Trading director of options Danielle Shay checked that list — not once but twice — and picked their favorites into the new year." on Wednesday. "Apple has definitely made Santa's nice list this year."

Apple is by far the best Dow performer of 2020. Shares have risen 78%, nearly double the gains for Microsoft. The stock is roughly 5% from its record set in early September. "When you look at the chart, you're still in a very nice well-defined uptrend. You can see that we've come back, successfully retested it, and we're getting back to retesting those old highs," Johnson said. "So, from my perspective, I'm going to stick with Apple. I think it's a gift that just won't be returned this year."Shay said in the same interview he is backing Microsoft for more gains in 2021.

"Microsoft has shown consistent earnings growth, and they've also shown a very consistent run into earnings the two to four weeks before that report. So for me personally, I love buying long calls in the earnings series to take advantage of the rise in [implied volatility], in addition to sellingAs for the worst performers, Shay does have much optimism in a turnaround.Boeing and Walgreens have fallen 32% in 2020 and Chevron 29%.

 

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