Weekly Watch List

OCN (3/17/13, +11.36%)

Additions:
None

Subtractions:
JAZZ (5/26/13, +7.56%)
LYB (5/19/13, -3.64%)

Last week the major U.S. indexes put the brakes on their downward skid. The Dow rose 0.9%, the S&P 500 tacked on 0.8%, the NYSE composite added 0.6%, and the NASDAQ inched up 0.4%. The IBD outlook remains at “uptrend under pressure”. Although the market took a bit of a breather, that doesn’t mean that the Bears are done mauling equities. Distribution on the indexes is still elevated and volume on up days has generally been lacking, a sure sign that there is currently a lack of buying conviction on the part of institutional investors. Sit back and let the market pick a definite direction, don’t try and guess which way it will go from here. Continue to use any near term strength to lighten up on your long positions and keep your watch lists, both long and short, at the ready. As long as the market continues to meander without a clear trajectory, move to the sidelines until the uptrend resumes or completely rolls over into correction.

Even though the market is still technically in an uptrend and new purchases are allowed, it’s probably best to refrain from making any. However, this week the one watch list stock is currently in a proper buy range. OCN, trading at $43.92, is still barely within 5% of a $42.17 buy point off of a 3rd stage cup base.

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

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