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Stock Tiger Stalking Stocks™
For Monday April 23, 2007
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Dow +12961.98 at
153.35, Nasdaq +2526.39 at 21.04, S&P
+1484.35 at 13.62
The Dow was the big gainer on Friday and for the week as
buyers chased higher PEs on better earnings than expected. Not
so much of a surprise as they have been lowering earnings
forecasts for some time. I suppose the Dow now needs to hit
13,000 to make the CNBC cheer leaders fall out of their chairs
with giddiness. The Dow winners with strong earnings were CAT as
they raised their full-year outlook and HON after good earnings
and boosting its 2007 guidance. The transports also closed at an
all time high.
GOOG reported very good earnings and this may not have yet helped
the techland Nasdaq too much but there is hope.
Advancers outpaced decliners on the NYSE by a 3-to-1
margin while those on the Nasdaq held a 2-to-1 edge.
Here are the indexes and the performance for the week. Gold
was weakest and that seems strange as the US dollar is back to
its March 2005 lows so gold is not too closely coupled now to the
Dollar. The Russell and AMEX actually lost points this week.
They had gained before the Dow but still would like to see them
participate in this latest rally. Our watch list had fewer
stocks trigger the past 3 days and this shows to me that even though the indexes are making new
highs it is not the type of strength it appears. The biggest
caps have been the leaders and the more volatile and growth
oriented stocks that more often find their way onto our watch
list were not so sought after this week. Maybe it means nothing
as Monday we had at least 13 stocks hit their buy point and I
think that was the largest number ever in one day. We do however
know that our watch list has been a pretty good barometer of the
broad market so if the market is to continue we will see many
more triggering this coming week.
Here are the sector top and bottom 5.
We now have 3 active stocks
in our Special Situation's long term category. Our 3 Stocks on
Fire so to say....and they sure have been.
 NUCON-RF
closed last Friday at $4.44 and this Friday at $6.94 so gained 57%
for the week an over 1,000% gain since March. I had so many emails
and phone calls this week and it was great to hear so many stories
of gains not only in these stocks but in general. One college student
senior has been paying off a good percentage of his tuition in the
market. We have mentioned the Golden Cross many times in the morning
videos and last month he noticed that CAT had one so bought
it at $66 with a stop under the 50-day so he was in it yesterday for
its nice gap up.
One of our members has been ill for many
months and could not actively trade but in November bought 6,000
NNRF at $0.82 as we had talked of it in the newsletter.
Another couple only got NNRF after the strong recommend in March
and during it first consolation under $1 and as they had 20,000
shares were happy to take some profits on the huge volume day
this week as they had never in their lives made so much from one
stock. Someone else got $1,000 shares at 0.65 and another had
1,700 shares at $4.00 and has been thrilled. Thanks for all the
notes of success. I think the move in this stock has just begun
for the long term and for most of my shares I want to qualify
for long term capital gains so will hold at least a year and
also the company has so many things to come in the next year
that are not at all priced into the stock. For the short term I
expect we will soon get news as I have heard that important
meetings were happening and some announcement is very likely.
This could be something that could propel the stock up higher
once again. If we get a move up this coming week to say $9 or
$10 It may then set up for a $1-$2 retracement and would the be
good to see if can consolidate a while. Over the next weeks and moths I expect we will see
many very exciting events and announcements from NUCON-RF so I
do not want to be short sighted and will hold the largest
percentage of stock to not miss these.
We had a good day of consolidation on
Friday on lower volume so we hay have room to run some more this
week.
 Coffee
Pacifica closed last Friday at $1.44 and this Friday at $2.07 so a
gain of 44%.
This company had major news
this week as they are now to sell "Fair Trade and Organic
certified coffee produced by farmer co-operatives in Ethiopia."
This is really big news. Ethiopia is the
worlds 6th largest coffee exporting country and as you know if
you have read what we recommended,
Coffee Pacifica has a great business model of working with and
enlarging cooperatives where the farmers greatly benefit. This
company's attitude allowed them to grow from under 500 farmers
they work with in Papua New Guinea
to over 120,000 today. They also added 3,000 farmers as they
control 30% of the Blue Mountain coffee in Jamaica and I have
read that Jamaica supplies bout 30% of the worlds coffee. But
the point is that Ethiopia can now give
Coffee Pacifica much more coffee to sell and greatly strengthens
their position. There was news this week that Government of
Jamaica to
privatize the coffee industry.
We know already that Coffee Pacifica hopes to increase their 30%
share of the Blue Mountain coffee to maybe over 40% and this
news may mean they can also expand into other regions in
Jamaica. In the least it shows that the government is certainly
not interested n nationalizing coffee.
Another benefit to
Coffee Pacifica adding Ethiopia is weather. One reason I
think I like owning CFPC is it is not a tech with someone
coming out with a better router next week and not a product that
is waiting on some FDA approval or denial like a biotech. The
risk is weather like a hurricane but with distribution from 3
countries
Coffee Pacifica actually has an advantage over single country
distributors.
Here is an interesting page about coffee from
countries
around the word.
Here is a page with some rough ideas about possible
profits from the sales of
Jamaican coffee.
We know that
Coffee Pacifica plans to move off the OTC and onto AMEX and as
far as I know need to have the stock price close over $2 for 10
consecutive days to qualify. If so than Friday was number one.
We only started Cryoport
this week at the $1.30 price and it closed Friday at $1.69 or a 30%
gain. The volume increase on the day we send the special alert was
impressive with over 2 million shares trading. There has yet to be
any news from the company and this can help the first consolidation.
On Thursday the stock ran up 55% so it is very likely that some of
that volume was from momentum chasers who buy anything moving and
may not even know the company name. They often sell at any pullback
to lock in gains and move on to another stock. These are the type we
can buy from. You can see there is a break out at $2.10 but this is not
a break out play but a long term one for months and perhaps years.
We expect news within 2 weeks but decided to not
wait until after it came out as we think it will be very well
received and wanted to be in the stock in front of it as it could
come out sooner.
Wow the Dow and its
tall thin candle from Friday. It may run up even more but that structure
cannot hold the weight without a correction. The RSI is again over
70 and can stay a while but watch if it drops below 70 and have your
futures or pro shares ETF favorites on hand to use as a real short
or a hedge against your longs. You know if you buy a short ETF it
goes up when the index it tracks goes down. Here is the
DXD and it is the
inverse of the Dow and you see it gapped down on Friday.
The S&P 500 is also at new recent
highs and
its all-time closing high, was 1527 in March
2000 so maybe it will give it a try but you see the trend line
resistance not far above and RSI getting to overbought levels.
The Nasdaq is at a trend line but since
the stochastics have not made it over 80 yet on the weekly chart
there is a good chance that if it does break above this trend line
that it in so doing may run to 2600.
The top market cap stocks in the Nasdaq are the Nasdaq 100 and here you
see that they are not yet to their top trend line in green.
For the Nasdaq to make a bigger move the Sox really needs to participate
and it is on the edge now and could start a rally on a break out here.
The SMH has a different component structure than the Sox and here you see
the break out on Friday. You can trade this as a stock.
The Russell 2000 had a break out and
failed on Monday but came back up to near the break out line on
Friday
.
This is good to read over bought conditions as the number of stocks
on the NYSE that trade above their 50-day average. It is not yet
above the 80 area that has predicted tops in the past.
Have not shown this is a while.
This uses the Value Line Index to show the 4-year cycle also
called the Presidential Cycle as it bottoms in the same point in
time generally every 4 years. When it bottomed in July this year we
did not think it would be the real bottom as it is usually in
October or as late as January so we at that time expected a second
bottom but it never came. Typically the market can gain 50% from
these 4-year cycle lows. From 699 the low in 1998 to the high of
1338 was up over 100% - next the low of 824 in 2002 to the
high at over 2000 in 2006 was also up over 100% and if we have seen
the low in July at 1874 then we could see 2811 as that would be the
more typical 50% rise.
This is a monthly chart so will not show
changes in a few days or weeks but we do see the positive divergence
and the slight break out here. This is the performance of gold
to the Dow and a break out here would mean that the Dow would
be outperforming gold.
Oil still inside its trading
channel and fell back to the 200-day EMA.
The US Dollar is in bad shape for
anyone who uses it in other countries so not now a good time for
travel in Europe as it is expensive for Americans. This is
however good for foreigners to go to the USA for summer vacations as
it is like a super discount on every thing. This would help the
tourist industry this summer if it stays low long enough. This is
also good for US companies that sell overseas as their products are
at much better prices. I have read some cycle charts that suggest an
early summer bottom of the Dollar. I only get 25.5 rubles to the
Dollar now and at one point was getting about 34.
Here is the economic calendar from briefing.com
Before we get to our watch list I wanted to mention something. A subscriber wrote
asking for more swing trades. You can define that in many ways but I think the
general idea of a swing trade is one that lasts for a few days or weeks. The main difference is how they are called or presented. We
generally do not give targets on our break out watch list as there is no staff
to watch every single stock once it hits a buy point. We suggest selling part on
the first day and you have to decide on the holding period after that. The ides
is that you lock in some quick gains so you can set a stop to prevent or limit
any losses on a pullback.
In the first example we have CY and it had two levels one at that $20.05
area and the next at the $20.42. Which ever level was bought the stock pulled
back to test it in both cases so if you had a stop below your break out buy
point you would still be in and could move up your stop.
This is an example using CYTR that broke out at $2.04 in January. It ran
up a few days and pulled back to test the break out line and if you had been
stopped out at a higher level that would be a good place to re enter as broken
resistance often becomes support as it was here. Later this stock ran to $3.20
and then came back to test the 2.55 support and then later after going to $5.49
came back to test the $3.20 support. The point being that most of our trades are
swing trades but we only present them as the first buy point and day traders who
do not like to hold take full profits the same day. Some of the stocks
after a break out fail and do not continue but with stops in place they can
remain profitable trades. I receive notes from people who have held ones like
this and send a "thanks for the double" and it often surprises me as I cannot
follow all past stocks. Many people who like a trade do their own investigation
of a company and decide to hold for fundamental reasons also as there is of
course often a reason why the stock broke out in the first place.
Now to some new additions to our watch list
PTY was on our list before but did not break out but it is back. A low
volume stock but here is the set up. On the daily chart you see a simple $16.82
top break but......
On the weekly you see that if it can break over
$17.03 it may be staring a whole new trend. We would want to see
better volume but point out why looking at a weekly chart can be
useful.
PMCS has a bit of a trend line and could be
bought over $7.65 for the move to about $8 and added there is if
gains some activity.
EDS has a double level. The
first needs more volume on its third tray over $29.50 and a clean
break would be over $30.00
For a change of pace - one for
gamblers. We heard
word Friday that GPSN may get listed on the Dubai exchange
and there will be some bigger buying coming in. At least a few of
us in the chat room bought on Friday as a move over $0.20 is
expected. This of course may not happen but the past volume has been
intriguing also. This is not a recommended play but may be good for
those who like a higher risk/higher reward short term play to exit
with a profit and not hold. If there is no news Monday and it does
not go higher I will add some more and on a small pullback also.
FISV formed a hammer on Thursday and then ran up to
resistance on Friday with a top break out now at over $55.22
WITM Was on the list in
March but could not then break out so maybe this time - over $1.30
FL has a top break at
$24.75 but the increased volume and golden cross suggest a buy over
$24.25 may work out.
TXN over $33.00 could go
with or help the SOX
QCOM also same as above
but over $44.20
TRMS been talked about
in the chat room with entry interesting over about $8.30 and the
50-day first target at $8.70. Want to see volume similar to
Wednesday.
SVVS straight forward
over $49.30
ASPV broke first level
buy a fraction so now in the little space and top break out over
$22.80 into the gap it would go.
ASD also closed at its
high so a continuation.
TSS break over $33.02
SAFM nice Friday volume so now over $37.12
GNA above $12.08
DXPE clean from an island over $44.75
From the
Joseph Holmes Site
That's a full lid for today - Will see you all
during the week.
Check the
current
Earnings Calendar
on all overnight holds.
Check the current
message board also for other good
stock candidates as there are several there right now.
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