Is This The Line Of Least Resistance Into Year-End?
The
biggest indicator in a long time gets released
before the bell on Friday: The Unemployment Report. Thus far, the Nasdaq has
struggled severely with the 2,000-level and looks like it may need a nice strong
piece of news to propel it higher. Could this report be that news?
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Many growth stocks have
found their ways safely above the 50-day moving averages following the recent
correction that began on Oct. 15. Take Yahoo!
(
YHOO |
Quote |
Chart |
News |
PowerRating) for example. The stock traded below its line of
support for several days, before rebounding to a recent high of 44.29; just
a stone’s throw from a new pivot point of 44.87.
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Former leaders have regained
strength and found themselves at new highs. Genprobe
(
GPRO |
Quote |
Chart |
News |
PowerRating) comes to mind here. The company’s performance has still shown
strong earnings growth and the stock took advantage.
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There has even been a little
life in the Chinese Internet names. Sohu.com
(
SOHU |
Quote |
Chart |
News |
PowerRating) stands out as one of the strongest, with amazing EPS and sales growth
rates.
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Semi names like O2
Micro
(
OIIM |
Quote |
Chart |
News |
PowerRating) are capable of providing strong leadership
in the near-term. The leading telecom sector may also be able to help propel
this market higher, with names such as Viasat
(
VSAT |
Quote |
Chart |
News |
PowerRating).
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Whatever the case may be,
the market’s internals and leadership may prove that the line of least
resistance is higher into the year-end. Today’s lower-volume pullback
in the Nasdaq is just another piece of the puzzle.
In honor of the stock market,
I will be in New York over the next few days and visiting the exchange on Friday.
The column will resume again next Tuesday.
Have a Successful Week!
timt@tradingmarkets.com