Breakoutwatch Weekly Summary 03/27/21
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|NASDAQ Recovering from March 5 Low
While our market trend signals remain positive for the DJI and S&P 500, the signal for the NASDAQ Composite remains negative. A glance at the NASDAQ chart shows why: the index failed to move higher than resistance set by the right shoulder of a bearish head and shoulders top pattern and also failed to hold above the 50 day average level. Note also how volumes have dropped off since the high set on February 16. Prior to that date, volumes were mostly above the 50 day average level but since then the opposite has been true. The below average demand level explains the price weakness.
Despite the weakness in the NASDAQ there are still reasons for optimism: the index has not tested the March 5 low and Friday's late surge implies improving confidence; Fed Chairman Powell says the economy is improving significantly, but remains far from the goals that would require a change in policy; the Treasury yield remains below the 1.7% level that provoked dismay last week and finally vaccinations are increasing which is a necessary condition for the pandemic to be behind us.
Since most cup and handle breakouts come from the NASDAQ exchange, it is natural that weakness in the NASDAQ will lead to fewer breakouts and there were no breakouts from that pattern this week. There were 33 breakout attempts from the Volatility Squeeze pattern, but only 17 of those closed the week above their breakout price.
|US Steel (USX)
Since setting a high handle (pivot above left cup) there was understandable profit taking but selling in the handle dropped to almost zero and the recovery has begun. With an expected increase in infrastructure spending, demand for steel is sure to rise and USX is well placed to improve profits.
No new features this week
Our latest strategy suggestions are here.
|Brkout Date||Symbol||Base||Squeeze||Brkout Price||Brkout Day Close||RS Rank*||Last Close||Current % off BOP||Gain at Intraday High|
|*RS Rank on day before breakout.|
|CRIS||13.00||3,059,637||Curis - Inc.||Biotechnology||99||11.41|
|GSL||17.85||858,954||Global Ship Lease Inc||Marine Shipping||94||15.29|
|SID||6.99||5,891,098||Companhia Siderurgica Nacional S.A.||Steel||93||6.14|
|DVAX||11.45||10,337,356||Dynavax Technologies Corporation||Biotechnology||89||10.16|
|USX||11.83||582,362||U.S. Xpress Enterprises - Inc.||Trucking||88||11.54|
|ENBL||7.42||2,334,682||Enable Midstream Partners - LP||Oil & Gas Midstream||87||6.80|
|FCF||15.56||854,374||First||Banks - Regional||81||14.64|
|These stocks meet our suggested screening factors
for our Cup and Handle Chart Pattern watchlist.
See Revised Rules for Trading Cup and Handle Breakouts
|Index||Value||Change Week||Change YTD||Trend1|
1The Market Trend is derived from our proprietary market model. The market model is described on the site here.
2The site also shows industry rankings based on fundamentals, combined technical and fundamentals, and on price alone. The site also shows daily industry movements.
|1 Week||13 Weeks||26 Weeks||Year-to-Date|
|1 Week||3 Weeks||13 Weeks||26 Weeks|
|REIT - Mortgage
|REIT - Hotel & Motel
|Charts of each industry rank and performance over 12 months are available on the site|
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