Weekly Newsletter 01/27/13
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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  
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The NASDAQ Composite continues to move up and approaches its recent highs. The index is outpacing the other major indexes with a gain of 6% in less than a month. Resistance lies ahead, but with the Fed maintaining its cheap money policy as long as employment remains depressed, it is likely that the upward trend will continue, although it is doubtful that the current pace can be maintained so a pause is likely. This could happen once the first resistance level is overcome. That level then becomes support so we may see the index in a trading range bounded by the dotted lines on the chart as the upper resistance level is tested.

NASDAQ Composite

 New Features this Week Additional Value that we added this week
EPS Trends

We introduce a new tool this week which will assist you in your fundamental analysis. The tool captures the changes in analysts assessments of EPS for the current quarter over the last 90 days. While the most recent assessment is the most important, the 90 day trend is also a valuable indicator of changing perceptions.

The tool is currently free and available to all newsletter readers as well as subscribers. Subscribers can access the tool from the Evaluate > Analytical Tools > EPS Trends menu. Newsletter readers can access it by clicking this image:

EPS trends

You will see that the tool allows  you to filter for specific EPS revisions . Clicking a symbol will bring up the CANTATA Evaluator and clicking the chart icon  brings up a candlestick chart.

Stocks are first listed in descending order of current earnings upward revision. Clicking a column heading will sort the data after doing a new data extraction. So for example, click the current estimate up arrow and you will get stocks with the highest earnings expectation. We expect to develop this tool more extensively in future and link it with our watchlists.

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

I was intending to present results of a screen that would look for the optimum filter settings over the last six months. These types of simulations can be lengthy and its been running for 8 hours and hasn't yet finished.

I will present the results next week.

Meanwhile, enjoy the new EPS trends tool.

 Market Summary Overview of market direction and industry rotation
Index Value Change Week Change YTD Trend
Dow 13896 1.8% 6.04% Up
NASDAQ 3149.71 0.48% 4.31% Up
S&P 500 1502.96 1.14% 5.38% Up
 Best Performing Index
1 Week 13 Weeks 26 Weeks Year-to-Date
Dow Jones
1.8 %
Russell 2000
11.31 %
Russell 2000
13.72 %
Russell 2000
6.58 %
 Best Performing Industry (by average technical score over each period)
1 Week 3 Weeks 13 Weeks 26 Weeks
Building Materials Wholesale Building Materials Wholesale Lumber - Wood Production Lumber - Wood Production
 Most Improved Industry (by change in technical rank2)
Recreational Vehicles
+ 70
Recreational Goods - Other
+ 55
Major Airlines
+ 123
Foreign Regional Banks
+ 174
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 18 20.15 3.38% 3.23%
Last Week 22 19.92 8.42% 5.89%
13 Weeks 312 21.31 10.35%
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 RGEN Repligen Corporation 96
Top Technical RGEN Repligen Corporation 96
Top Fundamental OCN Ocwen Financial Corporation 42
Top Tech. & Fund. OCN Ocwen Financial Corporation 42
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 RF Regions Financial Corporation 78
Top Technical GOL Gol Linhas Aereas Inteligentes SA (ADR) 74
Top Fundamental LL Lumber Liquidators Holdings Inc 42
Top Tech. & Fund. LL Lumber Liquidators Holdings 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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