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Saturday, July 6, 2013

Leader Charts

Even though it was only a 4 day week (and I did remember to put the blue arrows in the right place), it was an incredibly good week on the leadership list, with a nearly 3% gain overall and lots of big gainers. XRM was the biggest of them, with a very strong bounce off the 50dma, the absolutely ideal buy point. I got out to a new high on fairly high volume yesterday, offering a second buy point. Price relative, which was strong before, is now getting very strong. This is not very heavily traded, but does draw enough for the small time trader (like me) and can move pretty fast. I know just about nothing about the stock itself, but I will be looking into it.

VTSS was the second biggest gainer, and is another one I know next to nothing about. It has has a monstrous increase in average daily volume in the last month: that is usually a sign that it has come to the big money's attention and they are starting to accumulated it. It will probably be pretty volatile for the next few days, if not weeks, but on the time frame of several months, this may be starting a big run.

SODA was the biggest decliner, and is in a month long pullback that has brought it back to the original breakout point, so if you missed it the first time, as long as it can stay above the 50dma, here is a second chance. On thing I like about the chart is the fact that price relative dropped less than price, a sign of strength. This may be setting up for a pretty powerful breakout.

GMCR was the second biggest decliner, and has a very similar chart. This one has hit the 50dma and will possibly bounce here, but there is a pretty good chance it will break the 50 to test the breakout point and set a bear trap. Both of these stocks are heavily shorted, so any move up will have short covering as rocket fuel.

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