Slowly Coming Around
The Naz
posted one more day of distribution, but still does not raise a cause
to take action, since there has not been enough evidence of institutional
selling.
In the meanwhile, a couple of stocks
pushed through their pivot points. Krispy Kreme
(
KKD |
Quote |
Chart |
News |
PowerRating) broke out on volume that
was 150% above-average.
Virage Logic Corp.
(
VIRL |
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Chart |
News |
PowerRating) broke out of
a multi-month base on over five-times average volume.
The homebuilding group continues to
impress Wall Street as these stocks have been pushing higher. Lennar
(
LEN |
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Chart |
News |
PowerRating),
Centex
(
CTX |
Quote |
Chart |
News |
PowerRating), Ryland
(
RYL |
Quote |
Chart |
News |
PowerRating), NVR
(
NVR |
Quote |
Chart |
News |
PowerRating) and Beazer
(
BZH |
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Chart |
News |
PowerRating) all pushed higher yesterday.
The above examples show that growth
stocks have slowly been coming around and working. What have I found in the above
setups that differed from recent failures? Nothing. A perfect
example of a breakout from October that has worked well but did not display the
best technical picture, other than a 7-week+ base, was Genesis Microchip
(
GNSS |
Quote |
Chart |
News |
PowerRating).
The stock began its 16-week base on
6/28, and completed it on 10/19 with a breakout on heavy volume. Several days
before the move on 10/19, the stock sold off for two days of heavier volume. Yet
the stock managed to break out and advance about 80% to date. As the time
passes, eventually a leading group such as the homebuilders will emerge on top
and provide excellent candidates that succeed for us Intermediate-Term
investors.
The only setup I have yet to mention
in this column and will probably be a crazy breakout, similar to either
(
MGAM |
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PowerRating) or
(
BREL |
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News |
PowerRating) (and be sure to realize that those are two completely different examples,
one good and one bad), is Verisity Limited
(
VRST |
Quote |
Chart |
News |
PowerRating). The stock has a smaller float of
shares and a market cap of just over $300 million, so be careful!
Have a MERRY
CHRISTMAS
and I’ll see you on the 27th!!
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