Thursday’s Top Stocks
Today was a fourth session of ruthlessness–at least for raging bulls–as the
doorway to ‘profit-taking’ has become that much more narrow. Last week we had
the likes of Foundry (FDRY) reminding some investors how difficult profit-taking
can be when all the institutional buying decides to go for the same exit in
lemming-like fashion. Today’s poster child for ‘smart money’ selling was the
networking giant, the Cisco kid (CSCO). As one might expect, the indices broke
their recent technical consolidations and finished off the session down between
a modest .32% for the industrials to a more swaggering 2.52% for the tech-heavy
Nasdaq Composite….just say ‘mooove’ out of the way for the big money.
Things look pretty bad, at least for those not inclined to take profits when
they’re available. When Wall Street stops spinning ‘tails’ and the real news
is out–it’s past the booking profits stage. So now the stage is set for cautious
bulls to keep the horns ready. It actually has been for a few sessions now,
as we were consolidating quite nicely–but fortunately, the market didn’t give
us any truly bovine signals that a confirmed reversal was there for the taking.
There were some feeble attempts, but if you use the 30- or 60-minute charts
in conjunction with the daily–worst case scenario if you were going to the
feeding bin, it should have been a mild bout of indigestion–but nothing really
sickening enough to hurt a cautious bull.
The Nasdaq Composite is now off by 6.5% on stronger institutional selling,
slightly thru both 50-day MAs and closing at session lows at the bottom of a
technical band of support. Very scary now—right? Umm, scary was two weeks
ago when all was supposedly very well, and very well supported by raging bulls
everywhere. This cautious bull couldn’t be happier, because now things are shaping
up once more for some more potential quality feeding. Of course there’s no need
to wait though, ’cause it’s always feeding time for cautious bulls willing to
stick to the tried and true—namely disciplined, consistent daytrading tactics.
Volatility Readings:
| Volatility Index | Close | Net Change | Signals/Direction | % Above/Below 10 Day Moving Average | Significance |
| VXO ( $VXO | Quote | Chart | News | PowerRating) |
17.58 | up .52 | cvr 1, 7 buy | 9% above | not at extreme |
| VXN ( $VXN | Quote | Chart | News | PowerRating) |
26.60 | up .30 | cvn 1, 3, 6 buy | 9% above | not at extreme |
Hottest Sectors : Pharmaceuticals
(
PPH |
Quote |
Chart |
News |
PowerRating) and Retail
(
RTH |
Quote |
Chart |
News |
PowerRating)
Weakest Sectors : Semiconductor
(
SMH |
Quote |
Chart |
News |
PowerRating) and Biotech
(
BBH |
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 |
| China Yuchai | ( CYD | Quote | Chart | News | PowerRating) |
21.49 | Top of range consolidation on increased, above-average (IAA) volume on daily chart engulfing reversal bar |
2,820 | 4,158 |
| Genome Therapeutics | ( GENE | Quote | Chart | News | PowerRating) |
6.60 | Top of range close on heavy volume continuation bar of pattern b/o |
579 |
2,436 |
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 |
| NA | NA | NA | NA | NA | NA |
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 |
| SafeNet | ( SFNT | Quote | Chart | News | PowerRating) |
36.28 | Bottom of range consolidation on IAA volume testing 20-Day MA |
287 | 427 |
| Cognex | ( CGNX | Quote | Chart | News | PowerRating) |
29.50 | Bottom of range consolidation into technical support zone on in IAA volume |
268 | 612 |
Short Reversals Closing Basis.
| Name | Symbol | Price | Technical Strength | Average Volume 000’s | Today’s Volume |
| Netflix | ( NFLX | Quote | Chart | News | PowerRating) |
69.95 | Bottom of range consolidation approaching trading range supports |
2,348 | 1,954 |
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 |
| Amazon | ( AMZN | Quote | Chart | News | PowerRating) |
45.39 | 10,027 | 21,600 |
| 3M | ( MMM | Quote | Chart | News | PowerRating) |
79.45 | 2,842 | 3,456 |
| Eli Lilly | ( LLY | Quote | Chart | News | PowerRating) |
70.50 | 3,754 | 4,739 |
Institutional Laggards.
| Name | Symbol | Price | Average Volume 000’s | Today’s Volume |
| Electronic Arts | ( ERTS | Quote | Chart | News | PowerRating) |
44.17 | 4,954 | 3,772 |
| Agilent | ( A | Quote | Chart | News | PowerRating) |
35.30 | 3,194 | 2,757 |
| PMC Sierra | ( PMCS | Quote | Chart | News | PowerRating) |
20.29 | 7,049 | 9,326 |
Best of luck to everyone. Please use protective stops on all trades.