Here’s What The Action In Growth Stocks Means
NYSE-related indexes showed huge volume due
to Merck’s (MRK) problems with Vioxx as the stock took a huge hit.Â
Besides that, the trading was relatively calm as NASDAQ volume came in slightly
lower than yesterday.
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This week appears to be
positive as the indexes found support at their 50-day moving averages and we saw
accumulation days on 9/28 and 9/29. Growth stock action has been very slow
which means that the leadership of this market still remains in question.Â
Yahoo! (YHOO) attempted a breakout yesterday through a pivot point at
34.14. The move came on large volume behind the internet hype after Orbitz
was bought by Cendant. YHOO has been unable to produce any profits or
follow-through following the attempt.
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Vimpel Communications
(VIP) and MBT are setting up in tandem following what were two very slow
breakouts. VIP broke through 101.30 on heavy volume and MBT broke through 128.Â
Neither stock has been able to achieve a 20% gain from those respective points
and we are well past 4 weeks’ time which would have indicated real strength.
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If you choose to trade the
set-ups we are currently seeing, it should be done with caution. This market
has not yet proven anything and we have yet to see consistent leadership. This
week’s action in the indexes was encouraging and it will be interesting to see
what happens following the beginning of the end behind the U.S. Presidential
race. The first debate is this evening, and in my mind, this election will be
the opportunity to eliminate much uncertainty from the stock market in regards
to our country’s leadership and policies behind interest rates, the economy and
Iraq. Enjoy the viewing and have a great weekend!
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Tim Truebenbach