For Google to Go Higher, This Needs to Happen
Timothy J. Truebenbach is the President of True Capital Management and
general partner of True Capital Partners LP, a hedge fund. He uses a
disciplined model that trades on the intermediate-term time frame. For a
free trial to Tim’s Nightly Stock Analysis Report
The market remains in a confirmed uptrend.
We saw some institutional selling a couple of weeks ago in the major
indices, but it has since been absorbed.
The Fed hiked rates once
again and I don’t think I’ll believe it’s over until a meeting passes where
there is NO hike! They basically said they “may†have to hike rates again.
Betting, or investing on the Fed in the stock market is so difficult versus
simply following price and volume action.
After the bell rang, Google (GOOG)
fell short of expectations which are what investors actually suspected as the
stock seems to be building a new base that began as it topped on 1/11. This
is probably due after a solid breakout and run from around $320 in October,
2005. Consolidations and base-building periods are paramount for it to
continue higher down the road as it allows investors to re-gain confidence in
its business model.
In the last week, we have
seen the strong emergence of small-cap names to the forefront of the market.
The S&P 600 (IJR) and S&P 600 Growth (IJT) indexes have hit new highs,
accompanied by a number of stocks.
Tradestation (TRAD) sports
stellar earnings growth, a relatively low P/E for that growth and it recently
surpassed resistance at $16 to hit an all-time high.
Vital Images (VTAL) is also a
strong name that has advanced to new highs.
Click Commerce (CKCM) is more
of a turnaround play as it is only hitting 52-week highs. The stock is
displaying strong growth rates. When we see this many stocks out of one
capitalization, especially small-caps, push higher we know a solid trend is in
place. Small-cap stocks are true leaders in Bull Market advances. It may not
be the best idea to chase these as they rally, but focus heavily on this
market segment as you search for new candidates that may fit well into your
portfolio.
Enjoy your Investing!
Tim (Comments @ True Capital
Management.com (no spaces)