Archive for July, 2009|Monthly archive page

What More Could A Bull Want?

GSRTrades Weekly Market Report

What more could a Bull Want?

Market Bias

Buyer’s Caution

Our market bias is based on a combo of Fundamental and Technical evidence. Economic and earning trends are matched against our analysis of price and volume charts, giving us an inidcation of how friendly the market is for our beloved Breakout Growth Stocks.

This is active trading, not investing. Our holding periods can las a day to months. The idea here is to keep it simple. The goal is to accumulate as many trading profits as possible.

Where We Are


Two weeks of strong rallying across the major indexes has overpowered sellers.

We’ve upped our bias to Buyer’s Caution as breakout leaders make firm footing in this environment.

Successful speculation for our style of trading comes down to observation.

We don’t complicate matters. Trends take hold and stick or they don’t.

The idea is to cut your losses quickly when you’re wrong and let the winners take care of themselves.

Charts this week are telling a story of buyer-dominance as nearly all the sector groups have positioned themselves firmly above their 40-week moving averages.

Most of these groups are also taking out their 50-day averages while pegging New Highs for the year.

We’re seeing little signs of weakness.

Even the downtrodden Homebuilders Index conquered its 40-week average mark.

And Biotech was up more than 25% last week. Hello! It’s near an all-time high. You hear that?

But while nearly everything looks strong, it’s still weakness in the Banks that stick out like a wide open receiver ready to turn the game.

Reluctance from Banks to rally and break critical averages has been a flashing yellow sign for months.

It’s also of note that The Defense sector is showing  relative weakness.

Pentagon contracts for many players have held up this year, but it’s next year that we expect to see some shake up as Obama’s Congress makes way for shifting priorities.

Big ticket items like the F-22 fighter plane are out as cyber security and unmanned surveillance type contracts are in.

Opportunities for individual stocks are discussed on our Growth Stock Report found on our home site, GSRTrades.com.

Technically Speaking

MAJOR INDEX PERFORMANCE
BIAS
Index
Change
Wk. %
Action
+
DJIA
+349.30
+3.99%
Rallies above its major MAs
+
Nasdaq
+79.35
+4.21%
Rallies above its major MAs
+
S&P 500
+38.88
+4.13%
Rallies above its major MAs
+
Russell 2K
+29.24
+5.63%
Rallies above its major MAs
Arrows denote sector’s position above or below its 40-week exponential moving average. + indicates 50-day moving average above 200-day moving average.

FOUR-WEEK VOLUME INDICATORS
Accumulation
Distribution
BIAS
Index
Major
Minor
Major
Minor
DJIA
4 3 1 1
Nasdaq
5 2 0 1
S&P 500
2 3 1 1
Russell 2K
3 1 2 0
Accumulation = Day when index is up with volume above previous day’s. Distribution = Day when index is down with volume above previous day’s. This is how we measure institutional interest in market. Major days = when volume stronger than 50-day average. Minor days = when volume below 50-day average.

SECTOR PERFORMANCE
BIAS Sector Wk. % Action
U.S. Dollar -$DXC
-0.96% Consolidates below 50-day MA
+
Gold & Silver Miners -$XAU
+3.56% Rallies above  50-day MA
+
Consumers -$CMR +3.33% Rallies above  50-day MA
+
Cyclicals -$CYC +10.06% Rallies above  50-day MA
+
Technology-$DJUSTC
+3.18% Rallies above  50-day MA
+
Semiconductors -$SOX +3.58% Rallies above  50-day MA
+
Software -$GSO +4.85% Rallies above  50-day MA
+
Telecoms -$XTC +2.91% Rallies above  50-day MA
Banks-$BKX +0.65% Rallies above  50-day MA
+
Broker Dealers -$XBD +6.66% Rallies above  50-day MA
+
Retail -$RLX +4.72% Rallies above  50-day MA
+
Healthcare -$HCX +5.25% Rallies above  50-day MA
+
Biotechnology -$BKX +26.89% Rockets above  50-day MA
+
Pharmaceutical – $DRG +5.46% Rallies above  50-day MA
REITs -$DJR
+8.32% Rallies above  50-day MA
+
Homebuilders -$DJUSHB +10.10% Rallies above  50-day MA
+
Transportation -$TRAN +6.71% Rallies above  50-day MA
Airlines -$XAL
+8.59% Rallies above  50-day MA
+
Defense -$DFX +0.60% Consolidates under 50-day MA.
+
Energy Index -$IXE +5.76% Rallies above  50-day MA
*Arrows denote sector’s position above or below its 40-week exponential moving average. + indicates 50-day moving average above 200-day moving average.

Potential Market Movers This Week

Earnings releases:

  • MONDAY: Amgen (AMGN), Honeywell (HON), Plum Creek Timber (PCL), SOHU.com (SOHU), Verizon (VZ)
  • TUESDAY: Ceradyne (CRDN), Chicago Bridge & Iron (CBI), Deutsche Bank (DB), Supervalu Inc. (SVU), Valero Energy Corp. (VLO), Viacom (VIA)
  • WEDNESDAY: ConocoPhillips (COP),  Flextronics (FLEX), Moody’s Corporation (MCO), Qwest Communications (Q)
  • THURSDAY: ExxonMobil Corporation (XOM), Ingram Micro (IM),  International Paper Co. (IP), Olympic Steel (ZEUS), Pitney Bowes Inc. (PBI), Walt Disney (DIS), Waste Management (WMI)
  • FRIDAY: AutoNation (AN), Chevron (CVX)

Economic data:

  • MONDAY: New Home Sales
  • TUESDAY: Consumer Confidence, S&P/Case-Shiller Home Price Index
  • WEDNESDAY: Durable Orders, Crude Inventories, Fed Beige Book
  • THURSDAY: Initial Claims
  • FRIDAY: GDP-Advance, Chain Deflator-Advance, Chicago PMI

This Week’s Work On Discipline

Discipline is the soul of an army. It makes small numbers formidable; procures success to the weak, and esteem to all.” — George Washington

This Market Report gives our broad analysis that is the foundation for our Growth Stock Report, which highlights trading opportunities for individual stocks for paid subscribers.

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