Strong Medicine
The market served up a fresh dish of
breakouts among the high relative strength stocks Friday even as the major
averages did their best to mask this ongoing intermediate-term rally.
Meanwhile, note that pullback in the
major indexes came on lower than prior-session volume on both the Nasdaq and
NYSE markets. So selling was within bounds.
Q Med
(
QEKG |
Quote |
Chart |
News |
PowerRating) jumped out of a high
consolidation zone on robust volume. Note the increasingly steep slope in the
relative strength, another sign of momentum.Â
Elsewhere in the medical area, Salix
Pharmaceuticals
(
SLXP |
Quote |
Chart |
News |
PowerRating), a specialty pharmaceutical company focused on drugs
used in the treatment of gastrointestinal diseases, is putting in a high
consolation zone following a prior breakout.
Bebe
(
BEBE |
Quote |
Chart |
News |
PowerRating) followed through on a
prior breakout.
In the exchange-traded funds, the
action was to the downside, led by the tech-focused ETFs after warnings from
3Com
(
COMS |
Quote |
Chart |
News |
PowerRating) and Juniper Networks
(
JNPR |
Quote |
Chart |
News |
PowerRating) set the tone on Wall Street.
The Internet Infrastructure HOLDR
(
IIH |
Quote |
Chart |
News |
PowerRating)
lost 5.0%, the day’s sharpest loss among the tradable funds. The Broadband HOLDR
(
BDH |
Quote |
Chart |
News |
PowerRating) dropped 4.3%, the Dow Jones Internet iShares
(
IYV |
Quote |
Chart |
News |
PowerRating) 4.2%, the
Internet HOLDR
(
HHH |
Quote |
Chart |
News |
PowerRating) 3.4%, the Semiconductor HOLDR
(
SMH |
Quote |
Chart |
News |
PowerRating) 3.0%, the
Nasdaq 100 Tracking Stock
(
QQQ |
Quote |
Chart |
News |
PowerRating) 2.8%, the Dow Jones Technology iShares
(
IYW |
Quote |
Chart |
News |
PowerRating)
2.6%, the B2B Internet HOLDR
(
BHH |
Quote |
Chart |
News |
PowerRating) 2.3%.
All stocks are risky. In any new
trade, reduce your risk by limiting your position size and setting a protective
price stop where you will sell your new buy or cover your short in case the
market turns against you. For an introduction to combining price stops with
position sizing, see my lesson, Risky
Business.