Weekly Newsletter 03/10/13
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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  
Our caution over the markets reaction to the implementation of the sequester proved misplaced as the NASDAQ continued to move higher each day this week except Wednesday. Tuesday brought an accumulation day with a move higher on greater average volume, but in general volumes were below average. Even Friday's modest gain in response to a promising employment report was made on the lowest volume level of the week.

The NASDAQ's gain for the week outperformed the other major indexes, but upward movement on lower volume usually indicates the trend is weakening. The chart shows the lower volumes and also that the index is reaching it's upper trendline limit.

NASDAQ Composite

The lower volume also constrained the number of breakouts which were again well below the 13 week average.

Important Notice

We have outgrown our current server and must move to a newer, faster server in the near future. Preparations for the move are well under way and we plan to move next weekend. This may result in some service interruptions next Saturday and or Sunday (March 16 and 17). Because of the move there will be no newsletter next week.

 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

In his Washington Post article this weekend, Barry Ritholz explains why the daily attention that investors pay to politics and the economy is misplaced. While his analysis is mostly true for investors, it does not apply to traders who make their profits and losses on the daily "noise".

 Market Summary Overview of market direction and industry rotation
Index Value Change Week Change YTD Trend
Dow 14397.1 2.18% 9.87% Up
NASDAQ 3244.37 2.35% 7.45% Up
S&P 500 1551.18 2.17% 8.76% Up
 Best Performing Index
1 Week 13 Weeks 26 Weeks Year-to-Date
Russell 2000
3.04 %
Russell 2000
14.62 %
Russell 2000
11.9 %
Russell 2000
10.97 %
 Best Performing Industry (by average technical score over each period)
1 Week 3 Weeks 13 Weeks 26 Weeks
Major Airlines Building Materials Wholesale Building Materials Wholesale Lumber - Wood Production
 Most Improved Industry (by change in technical rank2)
Trucks & Other Vehicles
+ 58
Electronics Stores
+ 90
Toy & Hobby Stores
+ 210
Toy & Hobby Stores
+ 211
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 12 19.54 2.74% 1.3%
Last Week 11 19.08 6.16% 3.14%
13 Weeks 274 20 13.04%
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 OREX Orexigen Therapeutics, Inc. 94
Top Technical OREX Orexigen Therapeutics, Inc. 94
Top Fundamental WNC Wabash National Corporation 70
Top Tech. & Fund. RGR Sturm, Ruger & Company 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 ADY Feihe International Inc 80
Top Technical IMI Intermolecular Inc 60
Top Fundamental NEWP Newport Corporation 40
Top Tech. & Fund. THRM Gentherm Inc 36
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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