Articles from Jul 2007

Episodic Pivots Headlines

Headlines
ASHW | Catalyst: Analyst Upgrade -> Ashworth upgraded by B. Riley & Co
Float: 12 (mil) Institutional Ownership: 62% Relative Strength: 10
IBD EPS Rtg: 8 Net Profit Margin: -4% ROE: -8%
EPS Growth: 225% (1yr) -51% (3yr)
Sales Growth: 2% (1yr) 12% (3yr)

ASYS | Catalyst: New Contract -> Amtech gets $4.9 mln solar order, shares rise
Float: 6 (mil) Institutional Ownership: 23% Relative Strength: 95
IBD EPS Rtg: 13 Net Profit Margin: 0% ROE: %
EPS Growth: 387% (1yr) 0% (3yr)
Sales Growth: 45% (1yr) 28% (3yr)

DIOD | Catalyst: New Product -> Diodes, Inc. Announces Breakthrough 300V SBR(R) Rectifiers with Industry Leading Performance
Float: 20 (mil) Institutional Ownership: 86% Relative Strength: 64
IBD EPS Rtg: 96 Net Profit Margin: 15% ROE: 19%
EPS Growth: 35% (1yr) 55% (3yr)
Sales Growth: 60% (1yr) 36% (3yr)

FSLR | Catalyst: Common Offering -> Continuation - First Solar To Raise $1 Billion In Secondary Offering
Float: 67 (mil) Institutional Ownership: 35% Relative Strength: 99
IBD EPS Rtg: 75 Net Profit Margin: 8% ROE: 2%
EPS Growth: 172% (1yr) 0% (3yr)
Sales Growth: 181% (1yr) 248% (3yr)

FWLT | Catalyst: Cramer -> Sez many of the infrastructure stocks have had a nice pullback lately
Float: 70 (mil) Institutional Ownership: 81% Relative Strength: 99
IBD EPS Rtg: 75 Net Profit Margin: 9% ROE: 0%
EPS Growth: 257% (1yr) 0% (3yr)
Sales Growth: 59% (1yr) -2% (3yr)

GHM | Catalyst: Earnings Report -> Sales jump 37% at Graham
Float: 4 (mil) Institutional Ownership: 36% Relative Strength: 98
IBD EPS Rtg: 59 Net Profit Margin: 9% ROE: 20%
EPS Growth: 52% (1yr) 0% (3yr)
Sales Growth: 19% (1yr) 21% (3yr)

GPCB | Catalyst: Biotech/Drug Approval -> GPC Biotech's stock rebounded Monday after the company withdrew its new-drug application (NDA) for accelerated approval of prostate cancer drug satraplatin.
Float: 32 (mil) Institutional Ownership: 30% Relative Strength: 1
IBD EPS Rtg: 12 Net Profit Margin: -333% ROE: -73%
EPS Growth: 6% (1yr) 0% (3yr)
Sales Growth: 143% (1yr) 2% (3yr)

GRMN | Catalyst: Takeover, merger etc -> Garmin shares surged $5.17, or 6.5 percent, to $85.07. A CIBC World Markets Corp. analyst said the handheld satellite-based navigation device maker could make a bid for Navteq Corp., which develops digital maps.
Float: 100 (mil) Institutional Ownership: 31% Relative Strength: 95
IBD EPS Rtg: 98 Net Profit Margin: 29% ROE: 38%
EPS Growth: 65% (1yr) 42% (3yr)
Sales Growth: 73% (1yr) 46% (3yr)

INAP | Catalyst: Barron's. WSJ, BW etc story -> Tiny Rival Takes Aim at Akamai
Float: 40 (mil) Institutional Ownership: 53% Relative Strength: 23
IBD EPS Rtg: 45 Net Profit Margin: -4% ROE: -3%
EPS Growth: 170% (1yr) 0% (3yr)
Sales Growth: 18% (1yr) 9% (3yr)

ISRG | Catalyst: Earnings Report -> Continuation
Float: 36 (mil) Institutional Ownership: 95% Relative Strength: 98
IBD EPS Rtg: 98 Net Profit Margin: 21% ROE: 16%
EPS Growth: -25% (1yr) 0% (3yr)
Sales Growth: 64% (1yr) 60% (3yr)

MA | Catalyst: Earnings Report -> Anticipation for 8/1 Earnings report?
Float: 37 (mil) Institutional Ownership: 78% Relative Strength: 98
IBD EPS Rtg: 74 Net Profit Margin: 4% ROE: 7%
EPS Growth: -81% (1yr) 0% (3yr)
Sales Growth: 13% (1yr) 14% (3yr)

MCX | Catalyst: Takeover, merger etc -> MC Shipping to be bought by Bear Stearns Merchant for $284 mln
Float: 4 (mil) Institutional Ownership: 14% Relative Strength: 78
IBD EPS Rtg: 66 Net Profit Margin: 16% ROE: 19%
EPS Growth: -7% (1yr) 47% (3yr)
Sales Growth: 48% (1yr) 14% (3yr)

MSA | Catalyst: Analyst Upgrade -> Mine Safety upgraded by Robert W. Baird
Float: 29 (mil) Institutional Ownership: 73% Relative Strength: 58
IBD EPS Rtg: 47 Net Profit Margin: 7% ROE: 15%
EPS Growth: -21% (1yr) 10% (3yr)
Sales Growth: 1% (1yr) 10% (3yr)

PCCC | Catalyst: Earnings Report -> PC Connection Q2 earnings rise
Float: 9 (mil) Institutional Ownership: 47% Relative Strength: 76
IBD EPS Rtg: 92 Net Profit Margin: 1% ROE: 8%
EPS Growth: 204% (1yr) 32% (3yr)
Sales Growth: 13% (1yr) 8% (3yr)

RCCC | Catalyst: Takeover, merger etc -> Verizon to buy Rural Cellular in $2.67B deal
Float: 13 (mil) Institutional Ownership: 51% Relative Strength: 99
IBD EPS Rtg: 18 Net Profit Margin: -18% ROE: 0%
EPS Growth: -65% (1yr) 0% (3yr)
Sales Growth: 4% (1yr) 4% (3yr)

SPW | Catalyst: New Contract -> SPX lands Chinese nuclear contract, SPX Corp upgraded by Citigroup
Float: 56 (mil) Institutional Ownership: 83% Relative Strength: 92
IBD EPS Rtg: 39 Net Profit Margin: 4% ROE: 11%
EPS Growth: 21861% (1yr) 29% (3yr)
Sales Growth: 12% (1yr) 7% (3yr)

TEX | Catalyst: Earnings Report -> Terex Raises Its Full-Year Guidance 2Q Profit Climbs on Higher Sales
Float: 101 (mil) Institutional Ownership: 81% Relative Strength: 93
IBD EPS Rtg: 99 Net Profit Margin: 6% ROE: 28%
EPS Growth: 110% (1yr) 0% (3yr)
Sales Growth: 24% (1yr) 25% (3yr)

UBH | Catalyst: Takeover, merger etc -> Continuation
Float: 16 (mil) Institutional Ownership: 17% Relative Strength: 72
IBD EPS Rtg: 36 Net Profit Margin: 30% ROE: 14%
EPS Growth: -6% (1yr) 2% (3yr)
Sales Growth: 12% (1yr) 11% (3yr)

VVUS | Catalyst: Biotech/Drug Approval -> Vivus receives FDA approval of Evamist NDA; eligible to receive milestone payment of $140,000,000 from KV Pharmaceutical
Float: 56 (mil) Institutional Ownership: 51% Relative Strength: 90
IBD EPS Rtg: 28 Net Profit Margin: -114% ROE: -60%
EPS Growth: 21% (1yr) 0% (3yr)
Sales Growth: 18% (1yr) -14% (3yr)

WMAR | Catalyst: Earnings Report -> Continuation
Float: 15 (mil) Institutional Ownership: 74% Relative Strength: 51
IBD EPS Rtg: 44 Net Profit Margin: -1% ROE: -2%
EPS Growth: -203% (1yr) 0% (3yr)
Sales Growth: 4% (1yr) 3% (3yr)

WSTG | Catalyst: Earnings Report ->
Float: 4 (mil) Institutional Ownership: 20% Relative Strength: 33
IBD EPS Rtg: 93 Net Profit Margin: 2% ROE: 17%
EPS Growth: 19% (1yr) 43% (3yr)
Sales Growth: 32% (1yr) 38% (3yr)


No headlines
FXI
IAI
ICE
KIE
PZJ
RSP
TMB
XSD

Episodic Pivots Headlines

Headlines
ARTC | Catalyst: Earnings Report -> ArthroCare Reports Second Quarter 2007 Revenue of $80 Million, EPS of $0.37, Exceeding Consensus Estimates
Float: 28 (mil) Institutional Ownership: 104% Relative Strength: 85
IBD EPS Rtg: 42 Net Profit Margin: 12% ROE: 11%
EPS Growth: 27% (1yr) 50% (3yr)
Sales Growth: 23% (1yr) 30% (3yr)

AXL | Catalyst: Earnings Report -> American Axle quarterly earnings jump 67 percent net income rises 40% EPS $0.64 Per Share
Float: 50 (mil) Institutional Ownership: 102% Relative Strength: 77
IBD EPS Rtg: 74 Net Profit Margin: -7% ROE: -24%
EPS Growth: -503% (1yr) 0% (3yr)
Sales Growth: -6% (1yr) -5% (3yr)

BLG | Catalyst: Earnings Report -> Building Materials shares rally 19% on earnings surprise
Float: 29 (mil) Institutional Ownership: 98% Relative Strength: 7
IBD EPS Rtg: 46 Net Profit Margin: 3% ROE: 13%
EPS Growth: -22% (1yr) 67% (3yr)
Sales Growth: 11% (1yr) 32% (3yr)

BOOM | Catalyst: Earnings Report ->
Float: 12 (mil) Institutional Ownership: 95% Relative Strength: 93
IBD EPS Rtg: 86 Net Profit Margin: 16% ROE: 39%
EPS Growth: 84% (1yr) 135% (3yr)
Sales Growth: 43% (1yr) 47% (3yr)

CALD | Catalyst: Earnings Report -> Callidus Software Q2 loss narrows
Float: 29 (mil) Institutional Ownership: 47% Relative Strength: 95
IBD EPS Rtg: 25 Net Profit Margin: -11% ROE: -16%
EPS Growth: 2% (1yr) 0% (3yr)
Sales Growth: 24% (1yr) 2% (3yr)

CME | Catalyst: Other -> CME Group Reaches New Volume Records
Float: 35 (mil) Institutional Ownership: 82% Relative Strength: 69
IBD EPS Rtg: 94 Net Profit Margin: 38% ROE: 30%
EPS Growth: 32% (1yr) 48% (3yr)
Sales Growth: 23% (1yr) 26% (3yr)

CVTI | Catalyst: Earnings Report -> Rebound from Wednesdays reaction to 2Q Loss
Float: 6 (mil) Institutional Ownership: 67% Relative Strength: 3
IBD EPS Rtg: 10 Net Profit Margin: 0% ROE: -1%
EPS Growth: -125% (1yr) 0% (3yr)
Sales Growth: 6% (1yr) 5% (3yr)

CYMI | Catalyst: Earnings Report -> Cymer 2Q Profit Rises
Float: 35 (mil) Institutional Ownership: 110% Relative Strength: 66
IBD EPS Rtg: 86 Net Profit Margin: 17% ROE: 15%
EPS Growth: 88% (1yr) 0% (3yr)
Sales Growth: 42% (1yr) 27% (3yr)

DECK | Catalyst: Earnings Report -> Deckers Outdoor 2Q Profit Falls but beats forecast
Float: 13 (mil) Institutional Ownership: 109% Relative Strength: 98
IBD EPS Rtg: 87 Net Profit Margin: % ROE: %
EPS Growth: -1% (1yr) 47% (3yr)
Sales Growth: 15% (1yr) 36% (3yr)

GNET | Catalyst: Public Offering -> Global Traffic's offering of 4.5 mln shares priced at $6.25/shr
Float: 9 (mil) Institutional Ownership: 17% Relative Strength: 91
IBD EPS Rtg: 15 Net Profit Margin: -12% ROE: -23%
EPS Growth: -284% (1yr) 0% (3yr)
Sales Growth: 27% (1yr) 0% (3yr)

ICE | Catalyst: Earnings Report -> InterContinental Exchange profit rises 73%
Float: 67 (mil) Institutional Ownership: 75% Relative Strength: 96
IBD EPS Rtg: 96 Net Profit Margin: 45% ROE: 25%
EPS Growth: 712% (1yr) 87% (3yr)
Sales Growth: 101% (1yr) 50% (3yr)

KYPH | Catalyst: Takeover, merger etc -> Medtronic to buy Kyphon for $3.9B
Float: 46 (mil) Institutional Ownership: 120% Relative Strength: 96
IBD EPS Rtg: 88 Net Profit Margin: 2% ROE: 3%
EPS Growth: 30% (1yr) 10% (3yr)
Sales Growth: 33% (1yr) 46% (3yr)

LNCE | Catalyst: Earnings Report -> Lance, Inc. Reports 2007 Second Quarter Net Revenue of $197 Million, Up 5%, and Diluted EPS Increase of 50% to $0.30 from Continuing Operations; Raises Full Year Earnings Estimates
Float: 31 (mil) Institutional Ownership: 72% Relative Strength: 83
IBD EPS Rtg: 82 Net Profit Margin: 3% ROE: 12%
EPS Growth: 3% (1yr) -2% (3yr)
Sales Growth: 12% (1yr) 9% (3yr)

NTY | Catalyst: Earnings Report -> NBTY Inc. Q3 earnings rise
Float: 59 (mil) Institutional Ownership: 93% Relative Strength: 80
IBD EPS Rtg: 90 Net Profit Margin: 9% ROE: 20%
EPS Growth: 43% (1yr) 11% (3yr)
Sales Growth: 8% (1yr) 16% (3yr)

RGNC | Catalyst: Public Offering -> Regency Energy expects $312.5 mln from offering
Float: 12 (mil) Institutional Ownership: 29% Relative Strength: 88
IBD EPS Rtg: 24 Net Profit Margin: 0% ROE: -1%
EPS Growth: 36% (1yr) 0% (3yr)
Sales Growth: 26% (1yr) 0% (3yr)

SRCL | Catalyst: Earnings Report -> Stericycle Q2 earnings rise
Float: 84 (mil) Institutional Ownership: 83% Relative Strength: 91
IBD EPS Rtg: 91 Net Profit Margin: 14% ROE: 19%
EPS Growth: 57% (1yr) 18% (3yr)
Sales Growth: 30% (1yr) 20% (3yr)

SSD | Catalyst: Earnings Report -> Simpson Manufacturing Q2 earnings fall
Float: 37 (mil) Institutional Ownership: 95% Relative Strength: 75
IBD EPS Rtg: 50 Net Profit Margin: 11% ROE: 15%
EPS Growth: 4% (1yr) 20% (3yr)
Sales Growth: 2% (1yr) 16% (3yr)

TRGT | Catalyst: New Contract -> GlaxoSmithKline and Targacept Form Alliance in Therapeutics for CNS-related Disorders
Float: 13 (mil) Institutional Ownership: 25% Relative Strength: 92
IBD EPS Rtg: 49 Net Profit Margin: 9% ROE: 0%
EPS Growth: 96% (1yr) 0% (3yr)
Sales Growth: 2234% (1yr) 124% (3yr)

TUNE | Catalyst: Earnings Report -> Microtune Q2 net income rises
Float: 50 (mil) Institutional Ownership: 45% Relative Strength: 69
IBD EPS Rtg: 51 Net Profit Margin: -9% ROE: -7%
EPS Growth: -108% (1yr) 0% (3yr)
Sales Growth: 21% (1yr) 14% (3yr)

UBH | Catalyst: Takeover, merger etc -> KeyCorp to buy U.S.B. Holding for $24.95-share
Float: 16 (mil) Institutional Ownership: 17% Relative Strength: 72
IBD EPS Rtg: 36 Net Profit Margin: 30% ROE: 14%
EPS Growth: -6% (1yr) 2% (3yr)
Sales Growth: 12% (1yr) 11% (3yr)

WOOF | Catalyst: Earnings Report -> VCA Antech Q2 earnings rise
Float: 82 (mil) Institutional Ownership: 90% Relative Strength: 78
IBD EPS Rtg: 90 Net Profit Margin: 10% ROE: 26%
EPS Growth: 54% (1yr) 33% (3yr)
Sales Growth: 17% (1yr) 22% (3yr)


No headlines
ACA
JADE
SKF

Vacation Time


I will be on a working vacation till August end starting from tonight.

The Market Monitor and other regular data posts will continue once I settle down and find reliable web access in India. I will put the comments on moderation to catch spam.

Comparison

On February 27th we had a correction of some magnitude. The circumstances were vastly different. Look at these numbers below from that day. Look at the 65 days ratio.

Market Monitor

Total 4% plus bullish breakouts=24
Total 4% plus bearish breakouts=1404
65 day bullish/bearish ratio= 656/281
Stocks up 50% or more in a month=8
Stocks up 25% or more in a month=65
Number of stocks with 100% plus move =294
Number of stocks up 200% or more = 69
4% plus signals for 100plus universe=2
4% plus signals for 200plus universe=1

You will notice the 65 days ratio has deteriorated a lot during this correction and reversed. Which makes this different. In the past such ratio reversals have signaled 10 to 15% down moves. That does not mean this thing will develop same way, but the 1404 correction had panic written all over it. While this had enthusiastic dip buyers. So may be this might have more shakeout to get the dip buyers scared.

Opportunity Buffet Part1

With 76 stocks up 4% or more on a down day, it was not bad day for long side opportunistic plays. In real serious corrections you will find less than 30 stocks barely managing to eke out 4% gains. Yesterday we had 20 stocks up 8%. So the story continues, pockets of momentum still in play.In real corrections ultimately even the best of breed stocks breakdown or dive in to bases. So if this corrections continue, all momo names will also correct, only thing is they will have relatively weaker correction. Considering the way yesterday shaped up, I am of the opinion we might see more downside after brief rally attempts.

With a reflex bounce a high probability, it may not be bad time to look at the long side opportunities, you may not want to rush in to them however .Playing the bounce game is still for nimble swing or short duration traders who can keep one hand on exit door. If the market does not act right, one should be able to exit with little loss. The better strategy is to sit out and find opportunities once the 65 day ratio turns.

Bullish IBD 70 plus EPS
There were 30 stocks in this scan yesterday.

AAPL,Apple Inc (Google Yahoo Earnings Chart)
ACA,ACA Capital Holdings Inc (Google Yahoo Earnings Chart)
AGP,Amerigroup (Google Yahoo Earnings Chart)
AXYS,Axsys Technologies (Google Yahoo Earnings Chart)
BIDU,Baidu.com Inc (Google Yahoo Earnings Chart)
BLUD,Immucor Inc (Google Yahoo Earnings Chart)
CMI,Cummins Inc (Google Yahoo Earnings Chart)
DLX,Deluxe Corp (Google Yahoo Earnings Chart)
EICU,Visicu Inc (Google Yahoo Earnings Chart)
FFIV,F5 Networks Inc (Google Yahoo Earnings Chart)
FMR,First Mercury Financial Corp (Google Yahoo Earnings Chart)
GGG,Graco Inc (Google Yahoo Earnings Chart)
HPY,Heartland Payment Systems Inc (Google Yahoo Earnings Chart)
ICLR,Icon Plc Ads (Google Yahoo Earnings Chart)
IFSIA,Interface Inc Cl A (Google Yahoo Earnings Chart)
KEX,Kirby Corp (Google Yahoo Earnings Chart)
MCRI,Monarch Casino & Resort (Google Yahoo Earnings Chart)
OI,Owens Illinois Inc (Google Yahoo Earnings Chart)
OMTR,Omniture Inc (Google Yahoo Earnings Chart)
PCCC,Pc Connection Inc (Google Yahoo Earnings Chart)
PSYS,Psychiatric Solutions Inc (Google Yahoo Earnings Chart)
RVBD,Riverbed Technologies Inc (Google Yahoo Earnings Chart)
STRA,Strayer Education Inc (Google Yahoo Earnings Chart)
TGI,Triumph Group Inc (Google Yahoo Earnings Chart)
TISI,Team Inc (Google Yahoo Earnings Chart)
TNH,Terra Nitrogen Co L.P. (Google Yahoo Earnings Chart)
TYL,Tyler Technologies (Google Yahoo Earnings Chart)
VDSI,Vasco Data Security Intl (Google Yahoo Earnings Chart)
VIGN,Vignette Corporation (Google Yahoo Earnings Chart)
WFR,Memc Electronic Material (Google Yahoo Earnings Chart)


Out of these stocks to watch are:
MCRI, KEX, BLUD, FFIV, ICLR, VIGN, AGP, HPY, WFR, FMR, OMTR, GGG, DLX, PSYS, AND TNH

Bullish Double Trouble
13 stocks in this scan.

AAPL,Apple Inc (Google Yahoo Earnings Chart)
BIDU,Baidu.com Inc (Google Yahoo Earnings Chart)
CMI,Cummins Inc (Google Yahoo Earnings Chart)
DLX,Deluxe Corp (Google Yahoo Earnings Chart)
FFIV,F5 Networks Inc (Google Yahoo Earnings Chart)
GGL,Goodman Global Inc (Google Yahoo Earnings Chart)
OI,Owens Illinois Inc (Google Yahoo Earnings Chart)
OMTR,Omniture Inc (Google Yahoo Earnings Chart)
RVBD,Riverbed Technologies Inc (Google Yahoo Earnings Chart)
SQNM,Sequenom Inc (Google Yahoo Earnings Chart)
TNH,Terra Nitrogen Co L.P. (Google Yahoo Earnings Chart)
VDSI,Vasco Data Security Intl (Google Yahoo Earnings Chart)
WFR,Memc Electronic Material (Google Yahoo Earnings Chart)


Out of this possible buys are:
FFIV, TNH, WFR, DLX, OMTR

Bullish Multi Year Leaders
10 stocks in this list. This is the list to watch closely.
AAPL,Apple Inc (Google Yahoo Earnings Chart)
CMI,Cummins Inc (Google Yahoo Earnings Chart)
FFIV,F5 Networks Inc (Google Yahoo Earnings Chart)
ICLR,Icon Plc Ads (Google Yahoo Earnings Chart)
IFSIA,Interface Inc Cl A (Google Yahoo Earnings Chart)
TGI,Triumph Group Inc (Google Yahoo Earnings Chart)
TISI,Team Inc (Google Yahoo Earnings Chart)
TNH,Terra Nitrogen Co L.P. (Google Yahoo Earnings Chart)
VDSI,Vasco Data Security Intl (Google Yahoo Earnings Chart)
WFR,Memc Electronic Material (Google Yahoo Earnings Chart)


Out of this possible buys are:
FFIV, ICLR, WFR, TNH

Bullish 2 year IPO
These stocks take worst beatings during market corrections. The charts will look horrible. But many rally leaders come from such neglected stocks once a new bull leg starts.

ACA,ACA Capital Holdings Inc (Google Yahoo Earnings Chart)
ADH,Adherex Technologies Inc (Google Yahoo Earnings Chart)
BIDU,Baidu.com Inc (Google Yahoo Earnings Chart)
DUG,ProShares UltraShort Oil & Gas ETF (Google Yahoo Earnings Chart)
DVW,Covad Communications Group Inc (Google Yahoo Earnings Chart)
EBI,Evergreen International Balanced Income Fund (Google Yahoo Earnings Chart)
EICU,Visicu Inc (Google Yahoo Earnings Chart)
FACE,Physicians Formula Holdings (Google Yahoo Earnings Chart)
FMR,First Mercury Financial Corp (Google Yahoo Earnings Chart)
GGL,Goodman Global Inc (Google Yahoo Earnings Chart)
HBI,Hanesbrand Inc (Google Yahoo Earnings Chart)
HPY,Heartland Payment Systems Inc (Google Yahoo Earnings Chart)
IKAN,Ikanos Communications (Google Yahoo Earnings Chart)
KAD,Arcadia Resources Inc (Google Yahoo Earnings Chart)
KOG,Kodiak Oil & Gas Corp (Google Yahoo Earnings Chart)
MZZ,ProShares UltraShort MidCap400 ETF (Google Yahoo Earnings Chart)
OMTR,Omniture Inc (Google Yahoo Earnings Chart)
OPX,Opteum Inc (Google Yahoo Earnings Chart)
RVBD,Riverbed Technologies Inc (Google Yahoo Earnings Chart)
SDD,ProShares UltraShort Smallcap 600 ETF (Google Yahoo Earnings Chart)
SDS,ProShares UltraShort S&P500 ETF (Google Yahoo Earnings Chart)
SJH,ProShares UltraShort Russell 2000 Value ETF (Google Yahoo Earnings Chart)
SKF,ProShares UltraShort Financials ETF (Google Yahoo Earnings Chart)
SKK,ProShares UltraShort Russell 2000 Growth (Google Yahoo Earnings Chart)
THLD,Threshold Pharmaceuticals (Google Yahoo Earnings Chart)
TWM,ProShares UltraShort Russell 2000 ETF (Google Yahoo Earnings Chart)


Out of these stocks to consider are:
OMTR, FMR, IKAN, HPY AND HBI

Bullish Distressed Stocks

5 stocks in this scan today.
FBR,Friedman Billings Ramsey (Google Yahoo Earnings Chart)
FMTI,Forbes Medi-Tech Inc (Google Yahoo Earnings Chart)
HZO,Marinemax Inc (Google Yahoo Earnings Chart)
NLS,Nautilus Group Inc (the) (Google Yahoo Earnings Chart)
WHI,W Holding Company (Google Yahoo Earnings Chart)


Stocks worth investigating out of these are: FBR and HZO

The markets are at a stage where fresh shorts may not be the best option as such panic often lead to reflex bounces. Best short opportunities will be of weak rallies post such bounce. So I am not going to do second part of this.

Market Monitor

  • There is no fear in the market, so we had one of those mildly wild day, where after things becoming a bit ugly early on and continuing ugly till late afternoon, the dip buyers were back at it again and the final numbers don't look bad. With 76 stocks up 4% or more and momo names doing well, this is just a blip in the larger scheme of things. A correction in bull market. Shaking out weak hands. Unless this develops in to something more severe, this is just another correction.
  • As to where we are after the correction the Dow and S&P will be down just around 5% down and Russell is around 10% down.
  • I am sure it did not feel that way while it happened. Those who were positioned wrong and over leveraged must have taken large losses. But that is what this game is about. Wall Street is a mechanism to transfer money from less skilled speculators and investors to the more skilled one.
  • Now we are set up for a reflex rally and going by the markets last few years record it might be a rally which gives no chance to enter again. More realistically, we will have few weeks to months of high uncertainty .
  • Corrections consist of two phases, rapid selling and slow methodical selling. The rapid selling phase is what we saw till now. Once this is over certain sectors and stocks which have topped out, start their slow methodical move down. While this is happening, another set of stock start their slow journey to take on new leadership. So I will be actively looking for new emerging leadership themes over next few weeks.

Panic Buy

Quiet, weak markets are good to sell. They ordinarily develop into declining markets. But when a market has gone through the stages of quiet and weak to active and declining, then on semi-panic or panic, it should be bought freely.



So now we finally have some panic. While this panic is buyable, unless you are skilled and very confident of what you are doing, I see no rush to buy. Any rally, if it starts from here will have enough time to offer buying opportunities. Also if you see dip buyers and others getting too active, it is most likely that after a weak rally there will be another down move. As of now I still see lots of bullishness and people still holding on to momo names. So probably it will take couple of more scares for the market to put meaningful low. Low risk buy opportunities will appear after few weeks.

Update: With buyers rushing in to buy and the final numbers looking not as scary as they looked around 2:30, this move may have more downside after attempts at bounce.There is still no real fear in the market

Do you want to buy dips now


Now finally you see some mild fear scaring the dip buyers and stubborn bulls. You want to see people too scared to carry any position overnight.

In search of new leadership

Whenever the next leg starts after this mild carnage, new leadership will emerge. The stocks which were leading the rally are toast now. They will take lot of time to put together another rally. Those which have gone below 25% of their recent high will probably take months to repair the damage. Most will not come back.

After every correction, new leadership emerges silently. Airlines took off in early part of the rally, solar plays followed, then after a correction agricultural related industry took off. Which was followed by shipping. So the next phase will bring new leaders. One has to quickly spot the emerging leadership and capitalize. Most speculators make the mistake of clinging on to old leaders are expecting them to start rallying again. No amount of Viagra can get those things moving again.

If you are following any of the method like Double Trouble, IBD 200 or Multi Year Leaders, all these list will undergo lot of churn with new leaders making their way to the list. Episodic Pivots list is the list to keep a very close eye on after such corrections. New leaders often burst out with major price and volume moves. EP captures them all. Another good place to find emerging leadership is by going through the stocks up 25% or more in month.

Time to start building buy lists is now. Such panicky action often leads to sellers exhaustion and markets like these can turn on dime and lead to moonshot rallies.

Market Monitor Intraday Update

As of now for the first time in months the 65 days bullish to bearish ratio has flipped. You can see the amount of damage just few days of selling has done to market leadership.
But there is still lot of bullishness. You want to see less than 39 (now 45) figure on the 4% bullish side. You don't want stocks like AAPL holding on to their gain. You want to see a complete sea of red on the tape with less than 10 stocks up 4% plus. But we are getting there. This is good action. This will lead to good tradable rally in near future. The problem is most will be shit scared by then and probably miss it.

Later: Look for new leadership after the carnage

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