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Saturday, February 12, 2011

Leader Charts

 We fell just a few hundredths of a percent short of another 5% gain in the leadership list, which would have been the third week in a row of that kind of gain. Once again there were several big gainers and very few decliners.  BKI was the biggest gainer by a hair, and is pretty typical of many of the charts on the list. After an earnings breakout in January, it came back to test the breakout piit twice, including last Friday (blue arrow), which was the ideal entry point, and has now started it's move up. BIDU, NFLX, LULU, and PCLN, just to name a few, have very similar charts. This is what you see in bull markets.

 CIM was the biggest decliner, having missed on earnings. Notice how well it is holding the pivot point. This could very well trade sideways like this for a few days, until it meets the ascending 50dma, then resume it's uptrend. I don't have any price criteria for the leadership scan (this one does not quality for the relative strength list), and pobably won;t add any, as I think this stock is worth taking a look at.

ZAGG is probably the most volatile stock on the list, and is in the early stages of a growth cycle. It is now in the upper half of it's trading range, staying close to the 50dma as it builds a base. I don't have it reporting earnings until Mach 14, so I suspect it could be consolidating until then. I would not take a postition in this before earnings, as it can just as easily drop 25% as climb 25%.

DECK is also base bulding, and is near completion of the right side. I would be very leery of any breakouts before it has a chance to build a handle pattern, and it is reporting  February 23, which gives it time to do so.

I noticed that the ravages of inflation have hit IBD. The IBD 100 has now been reduced to the IBD 50, which saves them about a page and a half of print. I guess that's better than raising the price again. I think I will stick to my lists.

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