Thursday’s Top Stocks
Easy come, easy go–once again, all within the confines of a ‘confirmed rally’.
In Wednesday’s trade, our three amigos closed near session highs, after yesterday’s
‘classic’ intraday double-bottom signaled a ‘strong enough’ reason to believe
in the impossible–a reversal off key price supports that just wasn’t good enough
for many investing folk, I’m sure. Oh well, another day within the market’s
(not mine) ‘confirmed rally’ has the index proxies closing higher by .80% to
1%. With volume coming in a tad lighter and below-average…I personally wouldn’t
bet the ranch on it, but then again ‘Homey don’t play that game’–although the
reversal player in me certainly don’t mind ‘checking out Dodge’ while a few
have already ‘checked out’, so to speak.
So it turns out ‘cautious bull’ was right…so far. As stated yesterday, this
is where ‘cautious bull’ becomes less cautious. For me, yesterday and today’s
price activity gives me (yes, cautious bull) the green light to start looking
for my own kind of value–reversal longs that have found key support and/or
potential breakout candidates, that are showing ‘gump’tion during our latest,
very, very scary–market pullback.’ Maybe the cautious bull in you decided to
start testing the waters as well. Well, regardless of ‘whatever it is you like
to do’, whether it be trading millions of dollars of OEX puts, or just looking
for reversal longs in Digital River, like yours truly…all I can say is keep
yourself around to play yet another day by keeping the ego in check, and the
protective stops in place. Even great traders like James Cramer readily admitted
to being wrong. It’s a big part of the world’s greatest game–and if you ever
want to be as good as ‘da man, no matter what your size–remember this, ‘when
it comes to picking the prettiest girl in the line up, your opinion is a distant
second to the crowd’s flavor of the day.’ You might not like it, but in these
parts of the world (ahem..daytrading), that’s the only thing that really matters…bottom
line.
Some of it turned out exactly how I thought, and at other times throughout
the trading session, I had to make sure the edge was retained by keeping it
in the here and now, and admitting the error of my ways. Now that deserves a
great big, ‘High Five me again, Cramer!!’ The message yesterday was simple,
but it ‘bears’ repeating (grrrr). The reality of trading has been, and always
will be this–to keep your ‘edge’ in check, you have to be willing to play the
odds, just like the house does in Vegas. But, just like the house does, you
have to keep it a highly disciplined, consistent business that knows its limitations
(hmm…table limits, stop losses sound remotely similar?), so that you can keep
on grinding it out, day in, day out….Vegas style, baby.
Volatility Readings:
| Volatility Index | Close | Net Change | Signals/Direction | % Above/Below 10 Day Moving Average | Significance |
| VXO ( $VXO | Quote | Chart | News | PowerRating) |
19.45 | down .45 | cvr 1,2,6 buy | 6% above | At Extreme |
| VXN ( $VXN | Quote | Chart | News | PowerRating) |
29.96 | up .31 | cvr 3 buy | 11% above | At Extreme |
Hottest Sectors : Internet
(
HHH |
Quote |
Chart |
News |
PowerRating) and Semiconductors
(
SMH |
Quote |
Chart |
News |
PowerRating)
Weakest Sectors : Oil Services
(
OIH |
Quote |
Chart |
News |
PowerRating) and Telecom
(
TTH |
Quote |
Chart |
News |
PowerRating)
Thursday’s stocks to watch:
Technical Strength Top of Range.
Stocks are scanned from TM’s Proprietary and Technology 10 Momentum lists on
the Indicators page, as well as being hand selected, based on the most recent
technical action. This may include some or all of the following: abnormal
volume, price patterns, as well as bullish action off of technical price
supports or clearance of technical resistance in that day’s session.
| Name | Symbol | Price | Technical Strength | Average Volume 000’s | Today’s Volume |
| Mid Atlantic | ( MME | Quote | Chart | News | PowerRating) |
59.24 | Top of range consolidation in daily cup and handle patern on strong relative volume |
725 | 1,516 |
| Gen-Probe | ( GPRO | Quote | Chart | News | PowerRating) |
30.12 | Top of range consolidation within cup and handle pattern on above average volume |
837 | 1,029 |
Technical Weakness Bottom of Range.
Stocks are scanned from TM’s Implosion and Technology Implosion Lists on the
Indicators page, as well as being hand selected, based on the most recent
technical action. This may include some or all of the following: abnormal
volume, price patterns, as well as bearish technical action at key support,
or resistance levels based on closing prices.
| Name | Symbol | Price | Technical Strength | Average Volume 000’s | Today’s Volume |
| Avid Technologies | ( AVID | Quote | Chart | News | PowerRating) |
47.98 | Bottom of range close below price supports within established downtrend |
660 | 401 |
Stock Reversal Setups Closing Basis.
Stocks that are setting up on a closing basis as potential long or short reversal pattern
candidates. Candidates listed may have triggered on a closing basis, or close
to triggering ( my general rule is to list the pattern setup if it is within
+/-.15 of trigger price). Patterns include basing patterns (Slim Jims, 1,2,3s,
Double bottoms) consolidations, and triangle reversals. Background technical
supports in the form of Fibonacci levels, EMAs (DEMA=daily ema), RS, and former
price action are used in the decision making process.
Long Reversals Closing Basis.
| Name | Symbol | Price | Technical Strength | Average Volume 000’s | Today’s Volume |
| Digital Insight | ( DGIN | Quote | Chart | News | PowerRating) |
19.37 | Top of range consolidation on increased, above average trade ‘inside day’, off potential 123 daily chart technical bottom |
569 | 566 |
Short Reversals Closing Basis.
| Name | Symbol | Price | Technical Strength | Average Volume 000’s | Today’s Volume |
| NA | NA | NA | NA | NA | NA |
Institutional Favorites and Institutional Laggards.
The following stocks are selected from the Nasdaq, S&P 500 & 600 Indices,
and HOLDRs. These are normally heavily traded, liquid issues that are exhibiting
relative strength or weakness, patterns (consolidations or Slim Jims) , or
last hour volume surges, indicative of follow through in the very near term.
Institutional Favorites
| Name | Symbol | Price | Average Volume 000’s | Today’s Volume |
| Hewlett Packard | ( HPQ | Quote | Chart | News | PowerRating) |
22.34 | 12,587 | 14,691 |
| Xilinx | ( XLNX | Quote | Chart | News | PowerRating) |
35.85 | 7,637 | 8,670 |
Institutional Laggards.
| Name | Symbol | Price | Average Volume 000’s | Today’s Volume |
| Electronic Arts | ( ERTS | Quote | Chart | News | PowerRating) |
44.10 | 1,561 | 14,483 |
| Mercury Interactive | ( MERQ | Quote | Chart | News | PowerRating) |
44.46 | 3,452 | 7,148 |
Best of luck to everyone. Please use protective stops on all trades.
Chris Tyler