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Saturday, October 29, 2011

Leader Charts

We had another big week on the leadership list, with all but one making gains on the week, including 5 gaining over 10%. Having said that, it should also be noted that, by and large, the leaders are still under performing the market and bullish base patterns are few and fare in between. QCOR was the biggest gainer, and staged a big breakout on earnings. This is one of the few bullish charts among the bunch, and it is in the process of establishing a new trading range. So fat it has held the gains made on the breakout, so no one is in a hurry to take profits here. If it trades sideways for another week or two, it may be preparing for another move up. That gap will probably be eventually filled but that could be a long ways off.
 RNOW was the second biggest gainer, but that was an acquisition. CRI was the third biggest gainer, also breaking out big on earnings. This formed a short up and handle pattern, and last Friday (the blue arrows represent last Friday's candle) was in a perfect entry point had this not been scheduled to report the next week. It is also holding on to the gains it made in the breakout, so this one may also form the bullish flag pattern.The price relative line is not that impressive, but comparing it to the other stocks on the list, it is probably the bet looking one.

ULTA was the only stock to register a decline this week, and it was less than 1%. It is also in a cup and hadle pattern, but this one really looks awful. The price relative line has been declining for almost two months, and other than a bump early this month (after a near collapse), has not participated in the overall market rally. The handle has that big gash in it, which is pretty typical of what I have been seeing lately, but that hasn't stopped other stocks from breaking out, but this looks like it is unlikely to do anything until the next earnings date.

CMG was the stick with the smallest gain, so it qualifies as the second biggest "decliner". The price relative line did drop, so compared to the overall market this did decline. This reported last Friday, made a pretty big move up, but failed to break out, and is now consolidating right under resistance. On the positive side it has not dropped from there, and if we have another "rip your face off" rally in the market, this could break out, but I doubt it will outperform the market. Eventually it should begin leading again, but right now it seems the market is a little tentative about this one.

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