Weekly Watch List

ALXN (7/24/11, +62.68%)
AAPL (4/29/12, -3.47%)
MNST (10/16/11, +56.02%)
ULTA (4/8/12, +0.59%)
DLTR (6/3/12, +9.61%)
DG (4/8/12, +11.39%)
TJX (3/25/12, +11.83%)
TFM (6/17/12, +1.78%)
MA (9/24/11, +29.09%)
VRSK (6/10/12, +1.03%)

Additions:
None

Subtractions:
SSYS (6/17/12, -2.20%)

Last week, the major U.S. indexes ended mixed. The Nasdaq gained 0.7%, the S&P 500 and the NYSE composite both gave up 0.7%, and the Dow lost 1.0%. Thursday’s sharp drop on higher volume slapped a distribution day on all the indexes and degraded the IBD outlook to “uptrend under pressure”. The new uptrend is not off to a particularly good start with an emphatic distribution day coming so soon after the start of the rally. While it’s still technically okay to make new purchases, it’s probably best to back off to the sidelines for now and wait until a definite market direction becomes clear. If you already have made new purchases, keep them on a short leash and don’t let any profits, no matter how small, turn into losses.

This week, three watch list stocks are at or near a proper buy point. ALXN, trading at $95.95, broke out of a 4th stage flat base and sits just above a $95.11 buy point. ULTA, trading at $95.61, is still underneath the $96.75 buy point after breaking out of a 6th stage cup base. TJX, trading at $43.20, broke out of a 2nd stage flat base and is still within 5% of a $42.91 buy point.

/as usual, your mileage may vary, always do your own homework

Weekly Watch List

ALXN (7/24/11, +58.21%)
AAPL (4/29/12, -4.79%)
ULTA (4/8/12, +0.84%)
DLTR (6/3/12, +10.41%)
MNST (10/16/11, +66.68%)
DG (4/8/12, +10.53%)
TJX (3/25/12, +9.91%)
MA (9/24/11, +26.60%)
TFM (6/17/12, +0.00%)
SSYS (6/17/12, +0.00%)
VRSK (6/10/12, +2.02%)

Additions:
SSYS (6/17/12, +0.00%)
TFM (6/17/12, +0.00%)

Subtractions:
None

Last week, all the major U.S. indexes moved higher for the second week in a row. The Dow gained 1.7%, the NYSE composite added 1.5%, the S&P 500 rose 1.3%, and the Nasdaq inched up 0.5%. Friday’s +1.3% move on the Nasdaq was just enough of a follow through day for the IBD outlook to be upgraded to “confirmed uptrend”. As follow through days go, this one was on the weaker end of the scale and it’s also worth noting that for more than the last decade, no follow through days in June or July have resulted in sustained rallies. Nevertheless, for now it’s a confirmed uptrend so it’s time to start carefully putting some money to work. Start with partial positions until the rally either proves itself or falters.

This week, three watch list stocks are at or near a proper buy point. ALXN, trading at $93.31, has formed a 4th stage flat base with a potential buy point of $95.11. ULTA, trading at $95.84, broke past a $96.75 buy point on good volume, off of a 6th stage consolidation, but reversed intraday and now sits 1% lower. Remember, the higher the base count, the more prone any breakout is to failure and a 6th stage base count is pretty long in the tooth. It could still work, but be cautious. TJX, trading at $42.46, has formed a 1st stage flat base with a potential buy point of $42.91.

/as usual, your mileage may vary, always do your own homework

Weekly Watch List

ALXN (7/24/11, +56.71%)
AAPL (4/29/12, -3.76%)
ULTA (4/8/12, -1.09%)
MNST (10/16/11, +61.30%)
DLTR (6/3/12, +6.78%)
DG (4/8/12, +6.50%)
TJX (3/25/12, +7.33%)
MA (9/24/11, +23.59%)
VRSK (6/10/12, +0.00%)

Additions:
VRSK (6/10/12, +0.00%)

Subtractions:
None

Last week, the major U.S. indexes booked impressive gains. The Nasdaq surged 4.0%, the S&P 500 vaulted 3.7%, and the NYSE composite and the Dow each leapt 3.6%. Although the U.S. markets scored their best week so far this year, the IBD outlook remains at “market in correction”. Normally, Wednesday’s upside move, on higher volume, would have constituted a follow through day, signifying a new market uptrend. However, the market uptick happened on day three of a rally attempt and a proper follow through day can only occur on day four or later, so we continue to wait. Over the weekend, it appears that Spain has secured a $125 billion line of credit to bail out its faltering banks. The U.S. markets could rally further on this news and a follow through day could occur as early as Monday, or maybe not, as events in Europe tend to be unpredictable and prone to surprises. In any case, keep your watch lists current and be prepared to act if we do get a follow through day and a new market uptrend. Wait for a follow through confirmation, a 1.4+% increase on at least one major index, on higher volume than the previous day, and resist the temptation to jump in early.

With the market in correction, none of the watch list stocks can be considered as buy candidates.

/as usual, your mileage may vary, always do your own homework

Bonus content:

The following stocks currently exhibit potential technical characteristics consistent with historically successful shorting opportunities, emphasis on POTENTIAL:

APOL
CAVM
CJES
CXO
GM
HSP
PMTC
RDC
ST
TSO

INCORRECTLY SHORTING STOCKS CAN LEAD TO UNLIMITED LOSSES. Proceed at your own risk.

/How to Make Money Selling Stocks Short by William J. O’Neil

Weekly Watch List

ALXN (7/24/11, +48.52%)
AAPL (4/29/12, -6.97%)
ULTA (4/8/12, -8.93%)
MNST (10/16/11, +49.51%)
DLTR (6/3/12, +0.00%)
DG (4/8/12, +2.96%)
TJX (3/25/12, +5.88%)
MA (9/24/11, +16.24%)

Additions:
DLTR (6/3/12, +0.00%)

Subtractions:
SHFL (5/20/12, -1.99%)
VRSK (5/20/12, -1.20%)

Last week, all the major U.S. indexes took a nose dive. The Nasdaq and NYSE composite both plunged 3.2%, the S&P 500 cratered 3.0%, and the Dow disgorged 2.7%. The IBD outlook remains at “market in correction”. One could argue that the markets are oversold and that we’re due for a rebound, but I wouldn’t count on much of a bounce this week. Even though last Friday’s sell off was vicious, the volume didn’t indicate seller capitulation. Also, at least so far, there’s still no resolution to the festering problem that is Europe. In other words, the U.S. market indexes have all blown through recent support to the downside and, barring some surprise good economic news, there doesn’t seem to be any positive catalyst on the near term horizon that might reverse the current negative trend. Eventually, there will be a new uptrend that works, sooner or later there always is. Until that time comes, cash is king, the position of no pain.

With the market in correction, none of the watch list stocks can be considered as buy candidates.

/as usual, your mileage may vary, always do your own homework

Bonus content:

The following stocks currently exhibit potential technical characteristics consistent with historically successful shorting opportunities, emphasis on POTENTIAL:

CLD
OPEN
PPO

INCORRECTLY SHORTING STOCKS CAN LEAD TO UNLIMITED LOSSES. Proceed at your own risk.

/How to Make Money Selling Stocks Short by William J. O’Neil

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