Weekly Newsletter 08/05/12
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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  


Our trend model considers the NASDAQ Composite to be still in an upward trend but a descending triangle pattern shows that the trend is weakening. The index is making higher lows, which is positive, but lower highs shows market participants, which are increasingly computer driven trades rather than human beings, are doubtful that the index can move higher.

NASDAQ Composite

Since the index represents the aggregate performance of its component stocks, it is evident that expectations for strongly successful breakouts must be lowered. This is shown in the breakout results for the week with only 11 successful breakouts with an average gain of 3.68%.


 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


These are perilous times for the private investor who is not able to follow the market in real time. Even then the volatility introduced by high frequency trading makes it almost impossible for the private investor to be agile enough to make profits. Our long and short position pattern recognition algorithms can be successful when there is a clear bull or bearish trend, but when the market trends are weak as at present, it is better to stay on the sidelines and keep your powder dry for another day. This needs patience as it could be months or years before the markets return to their primary function of raising capital for company expansion.

 Market Summary Overview of market direction and industry rotation
Index Value Change Week Change YTD Trend
Dow 13096.2 0.16% 7.19% Up
NASDAQ 2967.9 0.33% 13.92% Up
S&P 500 1390.99 0.36% 10.61% Up
 Best Performing Index
1 Week 13 Weeks 26 Weeks Year-to-Date
S&P 500
0.36 %
S&P 500
1.6 %
S&P 500
3.43 %
NASDAQ Composite
13.92 %
 Best Performing Industry (by average technical score over each period)
1 Week 3 Weeks 13 Weeks 26 Weeks
REIT - Healthcare Facilities REIT - Healthcare Facilities Building Materials Wholesale Recreational Vehicles
 Most Improved Industry (by change in technical rank2)
Pollution & Treatment Controls
+ 66
Pollution & Treatment Controls
+ 74
Dairy Products
+ 150
Dairy Products
+ 185
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 11 13.54 4.25% 3.68%
Last Week 24 13.69 6.47% 5.29%
13 Weeks 232 14.54 8.15%
2.82%
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
Category
Symbol
Company Name
Expected Gain1
Best Overall ADY Feihe International Inc 104
Top Technical ADY Feihe International Inc 104
Top Fundamental NSM Nationstar Mortgage Holdings Inc 52
Top Tech. & Fund. NSM Nationstar Mortgage Holdings Inc 52
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
Category
Symbol
Company Name
Expected Gain1
Best Overall NCT Newcastle Investment Corp. 96
Top Technical NCR NCR Corporation 55
Top Fundamental HPY Heartland Payment Systems, Inc. 42
Top Tech. & Fund. HPY Heartland Payment Systems, Inc. 42
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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