Weekly Newsletter 08/19/11
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Market Summary Weekly Breakout Report Top Breakout Choices Top 2nd Chances New Features Tip of the Week
Prior editions of this newsletter with our valuable Tips of the Week are available here.
 Weekly Commentary  

It's a state holiday here in Hawaii, my wife and the boys are out of school so we taking a vacation day. I also have to get an early night as we have our annual Cycle to the Sun bike race tomorrow.

Briefly, as lawmakers are on vacation and it is unlikely that there will be good news out of Europe, I expect market volatility to continue at least until Ben Bernanke's speech at Jackson Hole next Friday.

While some hedge funds may be killing it this quarter, this is not a market we can play in successfully.

 New Features this Week Additional Value that we added this week

No new features this week.

This Week's Top Tip Tips for getting the most out of our site

I repeat last week's advice: The volatility present in the market this week creates opportunities for very short term traders, but is a challenge for most of us as the indexes can move by hundreds of points in a few minutes. Only computers can compete in this trading environment. In fact, as this Bloomberg article shows, trading volumes tripled due to computer driven high frequency trading. I think it is better to stay on the sidelines until volatility returns to more normal levels.

 Market Summary Overview of market direction and industry rotation
Index Value Change Week Change YTD Trend
Dow 10817.7 -4% -6.56% Up
NASDAQ 2341.84 -6.62% -11.72% Down
S&P 500 1123.53 -4.69% -10.66% Down
Russell 2000 651.69 -6.57% -16.84% Down
Wilshire 5000 11732.8 -5.13% -11.72% Down
 Best Performing Index
1 Week 13 Weeks 26 Weeks Year-to-Date
Dow Jones
-4 %
Dow Jones
-13.54 %
Dow Jones
-12.7 %
Dow Jones
-6.56 %
 Best Performing Industry (by average technical score over each period)
1 Week 3 Weeks 13 Weeks 26 Weeks
Personal Computers Personal Computers Personal Computers Cigarettes
 Most Improved Industry (by change in technical rank2)
Tobacco Products - Other
+ 60
Tobacco Products - Other
+ 150
Agricultural Chemicals
+ 156
Closed-End Fund - Debt
+ 201
Charts of each industry rank and performance over 12 months are available on the site

1The Market Signal is derived from our proprietary market model. The market model is described on the site.
2The site also shows industry rankings based on fundamentals, combined technical and fundamentals, and on price alone. The site also shows daily industry movements.
 Weekly Breakout Report How confirmed breakouts performed this week
# of Breakouts
Period Average1
Max. Gain During Period2
Gain at Period Close3
This Week 6 12.15 4% 0.9%
Last Week 15 12.15 1.6% -1.27%
13 Weeks 284 12.54 6.45%
1The average number of breakouts in each week over the previous 13 weeks.
2This represents the return if each stock were bought at its breakout price and sold at its intraday high.
3This represents the return if each stock were bought at its breakout price and sold at the most recent close.
 Top Breakout Choices Stocks on our Cup-and-Handle list with best expected gain if they breakout
Company Name
Expected Gain1
Best Overall FTLK Funtalk China Holdings Ltd. 91
Top Technical MFN Minefinders Corp. Ltd. (USA) 54
Top Fundamental ZNH China Southern Airlines Limited (ADR) 39
Top Tech. & Fund. ZNH China Southern Airlines Limited (ADR) 39
1This is the gain predicted by our Expected Gain model if the stock breaks out. Expected Gains for all cup-and-handle stocks are published on our site.
 Top Second Chances Stocks that broke out this week and are still in buyable range
Company Name
Expected Gain1
Best Overall ZROZ PIMCO 25 Yr Zro Cupn US Ty Inx Fd ETF 37
Top Technical TMF Direxion Daily 30-Yr Trsry Bull 3X Shrs 36
Top Fundamental TLT iShares Barclays 20+ Yr Treas.Bond (ETF) 9
Top Tech. & Fund. TLT iShares Barclays 20+ Yr Treas.Bond (ETF) 9
1This is the gain predicted by our Expected Gain model after the stock has broken out which uses the volume on breakout as a predictive term. Because the model variance is +/- 38% the expectation can be negative.

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