Monday’s Stock Watch
The markets have been on a tear north for the past
couple of days, with broad participation and heavy volume indicating a potential
bottom. We will be looking for follow through from Thursday’s session beginning
next Tuesday, where high-volume accumulation will indicate some
sponsorship from institutions. Without institutional support, the recent rally
will most likely be seen as just another vicious round of short-covering. For
the past week, the NYSE and Nasdaq have made two accumulation days, with no
distribution.
This past week was the first in seven that the
indexes have been able to post gains. New 52-week lows have tapered off, vs. a
still non-existent highs list. Mark Boucher‘s
Top
RS and ER List has shown bullish 20+ readings for the week, though the
Bottom RS and ER List still easily dominated, with numbers over 200 for a
couple of days. The markets still have the uncertainty of Iraq to deal with,
though earnings season is now in full swing, and could potentially provide
reason to buy — or sell if the bear maintains its grip.
Stocks on our watch list put in a good week, with
three new breakouts, and one selection removed. This market has been horrible
for selecting stocks that possess both top technical and fundamental properties,
though the search goes on.
From Friday’s action:
Market breadth was positive, with NYSE
advancing issues over declining issues by a ratio of 3.55, and up volume over
down volume by a 8.52 ratio. Nasdaq advancing issues over declining issues came
in at 2.18, and up volume beat down volume by a 4.13 ratio.
The Dow Jones Industrial Average
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed +4.19% at
7,850.29. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating)
closed +3.90% at
835.32.
The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed
+4.05% at
1,210.48.
2,413
2,297
Declining Issues
666
1,055
1,598,155,000
1,525,038,000
181,624,000
353,040,000
Total
Volume
1,783,544,000
1,917,067,000
Highs
6
3
8
12
Top sectors:
Health Services and Medical Appliances & Equipment.
Losing sectors:
Semiconductors, Major Airlines, Software, Telecoms, Internet,
Homebuilders, and Tobacco.
Watch List Action:
New to our “breakout” list, insurance company Brown & Brown Inc.
(
BRP |
Quote |
Chart |
News |
PowerRating), has
powered through its pivot buy point of 31.59 on over twice its average volume.
The stock is 13% of its 52-week high, coming out of over a three-month base, and
a member of the strong insurance sector.
Also new to our “breakout” list is holding company Mid Atlantic Medical Services
(
MME |
Quote |
Chart |
News |
PowerRating), whose subsidiaries are active managed health care and other life and
health insurance related activities. The stock broke through its pivot buy pint
of 38.83 on 10/10 with over twice its average daily volume. The stock hit a new
52-week high Friday.
Recent Breakouts
size=2>We monitor the action of Recent Breakouts as an indicator of
the market health for IT traders. When breakouts are acting well, this is a good
sign for the likelihood of further sustainable breakouts. When breakouts are
failing, IT traders should be even more cautious.
| color=#ffffff size=2>Company Name | color=#ffffff size=2>Symbol | color=#ffffff size=2>12 Month RS | color=#ffffff size=2>Price | color=#ffffff size=2>Price Change | color=#ffffff size=2>Average Volume | Pivot | 52-Week High |
Apollo Group | ( APOL | Quote | Chart | News | PowerRating) | 96 | 43.00 | -0.32 | 2,364,300 | 39.60 | 45.37 |
Brown & Brown | ( BRO | Quote | Chart | News | PowerRating) | 85 | 32.20 | +1.43 | 230,300 | 31.59 | 37.00 |
Education Mgt. Co. | ( EDMC | Quote | Chart | News | PowerRating) | 91 | 44.58 | +0.85 | 350,100 | 44.58 | 46.65 |
Hovnanian Enterprises | ( HOV | Quote | Chart | News | PowerRating) | 97 | 32.90 | +1.35 | 728,000 | 32.90 | 40.56 |
International Game Technology | ( IGT | Quote | Chart | News | PowerRating) | 92 | 67.36 | +1.56 | 891,100 | 66.70 | 71.95 |
Mid Atlantic Medical Services | ( MME | Quote | Chart | News | PowerRating) | 98 | 40.25 | +1.53 | 454,300 | 38.83 | 41.20 |
Wellpoint Health Network | ( WLP | Quote | Chart | News | PowerRating) | 94 | 80.84 | +2.44 | 1,317,700 | 79.05 | 86.27 |
Coming off our list is Hovnanian Enterprises
(
HOV |
Quote |
Chart |
News |
PowerRating)
as it fell more than 8% from its pivot buy point.
Also new to the breakout list is Wellpoint Health
Network
(
WLP |
Quote |
Chart |
News |
PowerRating).
Stocks Forming a Handle
| color=#ffffff size=2>Company Name | color=#ffffff size=2>Symbol | color=#ffffff size=2>12 Month RS | color=#ffffff size=2>Price | color=#ffffff size=2>Price Change | color=#ffffff size=2>Average Volume | Pivot |
None |
Stocks Building A Base
color=#ffffff size=2>Company Name | color=#ffffff size=2>Symbol | color=#ffffff size=2>12 Month RS | color=#ffffff size=2>Price | color=#ffffff size=2>Price Change | color=#ffffff size=2>Average Volume |
None |
href=”mailto:danielb@tradingmarkets.com”>danielb@tradingmarkets.com
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take a look at our
intermediate-term online trading course.
Intermediate-Term Traders
Report is posted on
Tuesdays and Fridays. For other intermediate-term commentary, be sure to read
Mark Boucher (Fridays),
Tim Truebenbach (Tuesdays and Thursdays), and
Gary Kaltbaum (Mondays and Thursdays).