Taking Advantage Of Indecisiveness
Nasdaq volume has been running heavy over the past
two days. Yesterday saw the average post a distribution day, and
today as I write this column, the Naz is down a little on heavier volume than at
this time yesterday. The S&P 500 is just churning itself, giving very few
signs of its direction.
Recent breakouts have all taken it upon themselves to take advantage of the
market’s overall indecisiveness and succeed!
Flir Systems
(
FLIR |
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PowerRating) broke out on
2/20 through its pivot point of 50.11 and still holds about 9% above it. The
stock is facing its first challenge today as it is down on pretty heavy volume.
We should take note and see if it can survive some profit-taking and move
higher, or if it fold like many of the names in the fourth quarter.
Next up is MDC Holdings
(
MDC |
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PowerRating). The
stock broke out on Tuesday, through a pivot of 41.70 and has pushed steadily
higher. As I mentioned on Tuesday, I would like to see certain fundamental
traits stronger, but from a technical perspective, this one is acting very well.
The last breakout I want to mention also comes from the homebuilding group
and is Meritage Corp
(
MTH |
Quote |
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News |
PowerRating). The stock
broke out yesterday on above-average trade and continues its advance this
morning. An interesting point on both MTH and MDC is they broke out and followed
through even though some of the other stocks in the group were rolling over,
such as NVR Inc.
(
NVR |
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PowerRating), Beazer
Homes USA
(
BZH |
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PowerRating) and Ryland Group
(
RYL |
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Chart |
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PowerRating). To me, that is showing two things: strength in MTH and MDC, and
secondly, that the group’s move probably wasn’t over yet.
The homebuilding group has been very strong despite a very shaky market. It
has been tough getting in, or staying in on the whole move, but this is where
patience comes in. Stocks always correct before they can move higher. Keep an
eye on the group as it may make an entry easier down the road following a
pullback.
Have a great weekend,