Here’s Wednesday’s Names
With the new highs list showing no
clear leadership and breadth still waning, we continue to peruse the markets for
potential intermediate term trading opportunities. Stocks building bases are in
abundance, but not many meet our fundamental criteria. So what should we do?
Continue to build our list of potential intermediate term candidates and test
the waters by adjusting position size and using stops on every trade we take.
The Nasdaq Composite closed higher
1.52% as volume increased 15.69% from the prior day. The markets are showing
some strength and things are apparently shaping up. However, caution is warranted
as we are just beginning earnings season and a bad report from a large company could turn this market around
quickly.
Pharmaceutical Resources
(
PRX |
Quote |
Chart |
News |
PowerRating) is forming a handle for its 10 week
“W” shaped
base. The generic drug company is showing some nice earning growth and sales
growth.
Ethical drug maker, King
Pharmaceuticals
(
KG |
Quote |
Chart |
News |
PowerRating) looks poised at testing its high of a 12+ week base. The
company has a 5 year growth rate of 109% with nice earnings and sales growth
over the last 4 quarters.
Some notable names to keep on your watch list.
Stocks Breaking
out on High Volume with a Relative Strength of 80 or Better:
| Company Name |
Symbol | Relative Strength |
Price | Average Volume |
Today’s Volume |
| Bioreliance Corp |
( BREL | Quote | Chart | News | PowerRating) |
97 | 28.11 | 41,600 | 1,057,900 |
Stocks
Building A Base With A Minimum Relative Strength of 80.
| Company Name |
Symbol | Relative Strength |
Price | Average Volume |
Today’s Volume |
| Krispy Kreme Doughnuts |
( KKD | Quote | Chart | News | PowerRating) |
93 | 37.42 | 901,800 | 275,300 |
| Action Peformance |
( ACTN | Quote | Chart | News | PowerRating) |
99 | 24.99 | 442,400 | 480,700 |
Stocks forming a
Handle
| Company Name |
Symbol | Relative Strength |
Price | Average Volume |
Today’s Volume |
| Group Automotive |
( GPI | Quote | Chart | News | PowerRating) |
98 | 33.25 | 210,200 | 74,600 |
| Pharmaceutical Resources |
( PRX | Quote | Chart | News | PowerRating) |
99 | 35.17 | 578,300 | 255,200 |
| Taro Pharmaceutical |
( TARO | Quote | Chart | News | PowerRating) |
98 | 40.45 | 712,100 | 746,900 |
Sectors leading the way in the green
on Tuesday were the Oil Services Index
(
$OSX.X |
Quote |
Chart |
News |
PowerRating) which climbed 3.3%.
The Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating)
tacked on 2.4%.
And the Interactive Week Internet
Index
(
$IIX.X |
Quote |
Chart |
News |
PowerRating) closed higher 2.3%, as did the Gold and Silver Index
(
$XAU.X |
Quote |
Chart |
News |
PowerRating).
No sectors were in the red, however
the Pharmaceutical Index
(
$DRG.X |
Quote |
Chart |
News |
PowerRating) and the Healthcare Index
(
$HCX.X |
Quote |
Chart |
News |
PowerRating)
closed relatively flat for the session.
Remember that all securities are
risky. In any trade, you should always reduce your risk by adjusting position
size and placing open protective stops where you will sell your long or
cover your short in case the market turns against you. For an introduction to
combining price stops with position sizing, see our lesson, Risky
Business.