Breakoutwatch Weekly Summary 01/15/22

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Weekly Commentary
Cup and Handle Stocks Perform Well Despite Market Conditions

Although the week started well, Wednesday's news that inflation was at an annual rate of 7% curtailed the rally. This followed Chairman Powell's comments at his Tuesday confirmation hearing that asset purchases will end in March and that rates will rise thereafter. Conventional wisdom is that growth stocks suffer in times of inflation and value stocks benefit. This may explain why the NASDAQ, which is dominated by growth stocks is 8% below its Nov. 22 high and is struggling to hold support at the 200 day level. It may also explain why the NASDAQ has the worst performance of the three major indexes, year to date. The prospects of all three indexes, however do not look promising as our tend indicators are negative for all three.

The best performing breakout this week was iRythm Technologies (IRTC) with a 21% gain. While it scores well on our technical scale, its fundamental score of only 4 out of 11 implies it may not go higher in the short term. Perhaps of more interest is the second place winner Teck Resources Ltd. (TECK) with strong earnings over the last 12 months and a fundamental score of 7.5 out of 11.
Chart of the Week
Our top pick as the stock most likely to breakout at the next session is oil and gas producer PrimeEnergy Resources Corporation (PNRG). Energy was one of only 2 sectors (the other being Communication Services) to close higher this week.

PNRG Chart

New Features this Week

No new features this week
Strategy Suggestions
Our latest strategy suggestions are here.
Breakouts Summary by Watchlist for Week Beginning 01/10/22
List Breakouts Avg. Gain
CWH 14 3.51
SQZ 16 1.55
Breakouts Gaining at Least 5% for Week Beginning 01/10/22
Brkout Date Symbol Base Squeeze Brkout Price Brkout Day Close RS Rank* Last Close Current % off BOP Gain at Intraday High
2022-01-10 IRTC CWH n 122.20 130.04 90 141.1 15.47% 20.99%
2022-01-10 TECK CWH n 30.44 31.2 93 33.98 11.63% 14.24%
2022-01-12 MIST CWH n 7.69 7.7 92 8.24 7.15% 7.15%
2022-01-12 SCX SQZ y 9.90 10.12 94 10.44 5.45% 7.98%
2022-01-11 DAC SQZ y 70.41 73.63 95 74.05 5.17% 6.28%
*RS Rank on day before breakout.
CwH Stocks Likely to Close above BoP at Next Session*
Symbol Company Industry RS Rank Last Close BoP % off BoP
PNRG PrimeEnergy Resources Corporation Oil & Gas E&P 97 73.98 75.04 98.59
RES RPC, Inc. Oil & Gas Equipment & Services 91 6 6.03 99.5
UCTT Ultra Clean Holdings, Inc. Semiconductor Equipment & Materials 91 60.34 60.49 99.75
FAT FAT Brands Inc. Restaurants 93 11.24 11.86 94.77
CVBF CVB Financial Corporation Banks - Regional 82 23.37 23.50 99.45
MIDD The Middleby Corporation Specialty Industrial Machinery 87 197.27 200.85 98.22
PARR Par Pacific Holdings, Inc. Oil & Gas Refining & Marketing 85 17.6 17.96 98
KRP Kimbell Royalty Partners Oil & Gas E&P 94 15.73 16.10 97.7
*These stocks were selected using our CWH price breakout model. This model selects stocks likely to close above the breakout price at the next session. When backtested over the three years beginning January 2019 until October 28, 2021, 80% of the stocks selected closed above their breakout price. This does not mean that on any day, 80% of the stocks selected will breakout, but it is the expectation over an extended period of time.
Top Rated Cup and Handle Stocks as of Friday January 14, 2022
Symbol BO
Company Industry RS
TSRI 14.47 1,287,155 TSR - Inc. Software - Application 96 11.80
KRP 16.10 546,544 Kimbell Royalty Partners Oil & Gas E&P 94 15.73
RES 6.03 1,231,152 RPC - Inc. Oil & Gas Equipment & Services 91 6.00
SACH 6.55 500,579 Sachem Capital Corp. REIT - Mortgage 90 6.05
WTTR 7.00 595,407 Select Energy Services - Inc. Oil & Gas Equipment & Services 88 6.80
CNR 19.08 876,652 Cornerstone Building Brands - Inc. Building Products & Equipment 85 16.34
PARR 17.96 555,568 Par Pacific Holdings - Inc. Oil & Gas Refining & Marketing 85 17.60
SFL 8.71 1,466,769 SFL Corporation Ltd Marine Shipping 85 8.55
WSR 10.50 605,296 Whitestone REIT REIT - Retail 85 10.18
LPL 10.78 878,301 LG Display Co - Ltd AMERIC Consumer Electronics 82 10.23
These stocks meet our suggested screening factors for our Cup and Handle Chart Pattern watchlist.
See Revised Rules for Trading Cup and Handle Breakouts
Major Index Summary
Index Value Change Week Change YTD Trend1
Dow 35911.8
-0.88% -1.17% Down
NASDAQ 14893.8
-0.28% -4.8% Down
S&P 500 4662.85
-0.3% -2.17% Down
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.
Best Performing Index
1 Week 13 Weeks 26 Weeks Year-to-Date
NASDAQ Composite S&P 500
S&P 500
Dow Jones
Best Performing Industry
1 Week 3 Weeks 13 Weeks 26 Weeks
REIT - Residential
Residential Construction
Industrial Distribution
Most Improved Industry (by change in technical rank2)
Aerospace & Defense
Aerospace & Defense
Aerospace & Defense
Aerospace & Defense
Charts of each industry rank and performance over 12 months are available on the site


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