Yahoo! Is Setting Up — Here’s The Chart
The major averages had me a bit worried as the indices posted declines
on heavier volume for most of the session. But then everything closed nicely
for a happy ending to an otherwise slow session. The major averages were
able to close higher on heavier volume than yesterday (not shown on charts
below). Unfortunately, we’re still seeing extremely slow action due to the
summer time-period. Below-average volume in the market is becoming a norm
each trading day.
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src=”https://tradingmarkets.com/media/2003/Tim/tt082603-02.gif” width=”418″ height=”348″ />
One more positive to pull
from the market’s price/volume action is that the S&P 500 managed to squeak
out another close above its 50-day moving average.
Individual stocks in the
growth sector are presently setting up. Damage is not being done, but we
are also not seeing most of these growth names continuing higher right now. Network
Appliance
(
NTAP |
Quote |
Chart |
News |
PowerRating) was a recent name to break through 19.84 on
good earnings and guidance, but it is spending a bit of time consolidating
those gains.
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Stocks like
Gilead Sciences
(
GILD |
Quote |
Chart |
News |
PowerRating) went up over
the past few days, but then came right back to where they were. Yet if you
notice in this example, it is still not showing distribution (lower prices
on above-average volume). It is hugging its 50-day moving line of support
quite well!
 src=”https://tradingmarkets.com/media/2003/Tim/tt082603-04.gif” width=”418″ height=”348″ />
One freebie that is setting
up and has solid fundamentals is Yahoo!
(
YHOO |
Quote |
Chart |
News |
PowerRating). This stock is poised to move through a double bottom base with
a pivot point at 33.97. I must say that everyone concerned with historical
valuations will laugh at me and YHOO’s 111 PE, but the chart looks like it
may make a move along with triple-digit quarterly earnings growth rates.
Price and volume seldom lie and I have had many short-sellers willing to bet
that it would drop before rising and I haven’t seen that happen yet!
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There is no doubt trading
is slow right now and may remain that way through Labor Day. But based on
the market’s and leading stocks’ action, we may be in for one heck of a fall
unless something big changes.