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Feb 26th: The Dow and S&P completed bullish 'three white soldier' combinations of candlesticks on Friday. The Dow ended 27 points shy of resistance and the S&P only a couple of points from resistance. If you took profits off the table over the last couple of days you may be itching to get back in - but since we are still below resistance in these markets, and inside declining channel line resistance of the NASDAQ and NASDAQ 100 it is still a little too early to be buying, but markets are very close to making their next move up. Monday could be the day things happen - but we need to see a volume confirmation (i.e. higher volume than Friday's and above average volume for the last 60-days). Gains on low volume signify retail buyers as the only market participants. Without the institutions it is unlikely such gains would hold. If you are looking to trade the 'three white solider' combination, set buy orders at the open of the second of the three candlesticks, setting stops on a loss of the lows of the first candlestick. Just as the open price of the second of the 'three black crows' of the Russell 2000 was used to sell (and acted as resistance), the reverse situation of the 'three white soldiers' is true and should act as support in the Dow and S&P. Of the secondary indicators, only the $NAA50 was able to signal a "buy", the $BPCOMPQ and $NASI remain bearish.

Breakout failures: ARIA featured on Dec 16th clipped its stop and reversed. BCSI featured on Jan 19th gapped down and sold off on earnings. GMST plummeted when it planned to stop providing guidance, the stock featured on Sep 17th. PNR featured on Feb 9th hit its top on Thursday with a doji.

Breakout targets met: IMR featured on Nov 22nd, current target hit for a 33% gain. Next target to aim for is $29.00. USU featured on Sep 16th and Jan 26th enjoyed a strong Friday meeting its target of $16.45 for a 74% and 43% gain respectively, look for next resistance at $20.00.

Feb 24th: The Dow and S&P both made substantial gains - but the bearish sell off from Tuesday continues to dominate. The tech indices [NASDAQ and NASDAQ 100] did manage a day of accumulation, but their declines remain in effect with the 200-day moving average still favored as a point of support. An upside break of 2,100 and 1,561 are buys for the NASDAQ and NASDAQ 100 respectively. Watch the semiconductor index for a follow through on today's gains - it had a solid day.

Feb 23rd: The Dow recovered some but not all of yesterday's losses. The reversal is not considered bullish because it failed to regain more than 50% of the prior day's losses. Lower volume doesn't help the bulls cause, and the bearish crossover in the MACD trigger line below resistance of the bearish divergence is the icing on the cake for the bears. What can the bulls look for? The Oct-Jan support line is an intermediate level of support and should stall the decline for another couple of days - this should be viewed as a chance to complete profit taking. The tech indices [NASDAQ and NASDAQ 100] were no better off - continuing the downtrend started from the 50-day moving average. Again, the MACD trigger line showed a bearish crossover below the bullish zero-line. Bulls should continue to watch for support at the 200-day moving average, but now it is probably best to sit on the sidelines. Secondary indicators [$BPCOMPQ, $NASI and $NAA50] begun to resume their declines at an angle which suggests the worst is not over - compare the tight rise of the moving averages for early Feburary to current broadening moves in the averages. Bulls should watch for bullish divergence in the CCI and MACD indicators of the secondary indicators before considering buying again. Note: Secondary indicators will signal a 'buy' by crossing above the 3- and 5-day EM averages before the bullish divergence can be confirmed. As for the S&P, it sits right on support of its Oct-Jan support line. Thursday will give an indication of how good support is here - as of 2:00 am ET futures were slightly down.

Breakout failures: CRGN featured on Nov 5th and managed to rack up a maximum gain of 27.20% before reversing. EDVO featured yesterday and stumbled out of the gates for a loss.

Breakout targets met: DCEL featured on Nov 11th closed above its stated target for a 40% gain - new upside target for current longs is $3.69.

Feb 22nd: Bears swooped in to kill as consumer confidence was not what it was cracked up to be (until they revise it of course) and oil surged to $51 a barrel. Weakness in the dollar added insult to injury as South Korea decided the dollar wasn't up to it (hardly a surprise considering how far it has already fallen) - only when more countries follow will we see a bottom here a la contrarian. This can only be good news for gold which has surged on the dollars weakness. Volume was heavier in all markets, recording a day of distribution in the markets. Bulls should be moving back to the sidelines and wait and see what happens at the 200-day moving averages before deciding to commit money. Current breakouts are back on shakey ground - it looks like it won't be until April when breakout plays will be in vogue again. The 200-day moving averages are not guarnteed support given the potential for measured moves in the NASDAQ and NASDAQ 100. The Dow confirmed the bearish tweezer top and a move below 10,368 will confirm a double top. Today's rapid gains have fallen inside fib retracements, so we may see some sideways action as the losses are digested. The S&P broke its bearish wedge to the downside. Only the Russell 2000 managed to dig its nails in, but look to fib retracements for support. Ugly ugly ugly.....

Breakout failures: CRL featured on Feb 16th never followed through on its gains. CHRS featured on Nov 5th but was never able to break past $10.00. DJO featured on Feb 9th and Jan 10th. WITS featured on Feb 3rd stumbled but the chart still looks okay.

Breakout targets met: none

Update: New stocks added to the Stock Scan featuring a mix of fundamental and technical paramters. These stocks are used to fill the Model Portfolio and are recommended for investors and long term holders

Feb 19th: [Msg for J Trautwein: your mailbox is full, my email to you has bounced back]. After Thursday's selling, Friday was a day for regrouping. The intermediate correction started in January remains in effect. Trading volume in the NASDAQ and NASDAQ 100 was lighter than Thursday's as some traders made an early start to the long weekend. The Dow gained some traction as it closed higher on heavier volume, although it is still a solid day's gains away from negating the bearish tweezer top. All three of these indices remain under the influence of bearish divergences in the MACD trigger line. The Russell 2000 closed back inside its bullish channel but above 625 support - the index has little room to maneuver without generating a larger signal: a loss of 625 has the lower channel line at 585 come into play - a break of 635 puts 650 back into range. The S&P ended Friday at support of its bearish wedge, although the technical picture with respect to the MACD and on-balance-volume continues to favor the bulls. The semiconductor index continues its orderly decline to moving average convergence inside bullish fib retracements. Secondary indicators [$BPCOMPQ, $NASI and $NAA50] remain uninspiring as all three indicators trade below their 3- and 5-day exponential moving averages.

The more interesting stocks on my public list are in the precious metal sector. Other stocks remain in limbo, or in pullbacks. Fib retracecements should be watched as potential entry points assuming recent near term lows in the overall markets hold. GSS - aggressive buy at $3.00 support as other mining sector stocks have already completed upside breaks. DROOY bounced - pulled into fib retracements - and is now in a position to move to new highs. The base metals [Silver and Gold] are an interesting trade on a retracement to fib levels. SIL, breakout of near term price highs supported by sharply rising technicals. ABXA has show some interesting large volume trading over the last week. FIX has held its recent gains nicely - remaining above near term support. On the flip side, DDS is just barely hanging on to support of its own. Stocks like NT and SUNW are also walking on thin ice. GEG continued to weaken following a bull trap. On the bullish front, ARBA looks to have bottomed on an island reversal. Other than the horrendous on-balance-volume, CLZR completed a tweezer bottom on Friday. IIIN is up against resistance of a bullish flag - higher prices should be watched for. IVAN broke near term resistance on Friday, following through on Wednesday's accumulation.

Breakout failures: ASF featured on Feb 17th. PUMP featured on Feb 8th, but since clipping its stop has zoomed up to $20.00. RUS featured on Feb 7th.

Breakout targets met: GAP featured on Dec 10th reached highs of $11.56, but did hit its target of $10.74 on the way for a 20.54% gain. LAD featured on Nov 2nd for a 28% gain.

Feb 16th: The tech indices remain poised below resistance. The NASDAQ gave little away as to what to expect tomorrow, Friday, or later next week. Bulls should be ready to hit the "Buy" button when the index gets past 2,105 and completes a sequence of higher highs and higher lows. However, weak secondary indicators [$BPCOMPQ, $NASI and $NAA50] and the bearish flag continue to dominate suggesting recent buying spikes represent distribution from the institutions to the weak (retail) hands. The NASDAQ 100 fared little better, today's small doji is a neutral candlestick, but the index made little ground back to its 50-day moving average. Although the MACD histograms of the tech indices continue to play to a bullish divergence, the respective trigger lines sing a different tune and remain below the bullish zero line. Sadly, the Dow put in a second tweezer top which may turn into a double top. The MACD trigger line hasn't breached resistance of the bearish divergence so the bears still edge it here - eventhough new highs are only a skip-and-a-jump away (another 35 points and we will be singing a different tune). The S&P edged slightly higher, but remains below a resistance line which connects the lows of November/December to the highs of January/Feburary which may form part of a bearish wedge. Should this play to form we should see some rapid downside very soon. The sole bright spot today was the Russell 2000. The index managed to close above channel resistance supported by yesterday's break of MACD trigger line resistance. Bulls can at least seek comfort here.

Breakout failures: none

Breakout targets met: CERS featured on January 5th closed for a 49% gain.

Feb 15th: Early gains in the NASDAQ and NASDAQ 100 reversed on tests of their respective 50-day moving averages. The Dow and S&P fared better, closing up on stronger volume, marking a day of accumulation for both markets. The Russell 2000 finished flat, but resistance in the MACD trigger line was breached, as was the case in the S&P but not the Dow (yet). The $NASI continues to struggle as the $BPCOMPQ ended the day flat, right on the 3- and 5-day exponential moving average. Short term longs should sell and wait for the 50-day moving averages to break in the tech indices, or resistance in the large cap indices, before buying again.

Breakout failures: AXCA featured on Dec 16th reported earnings after hours on Monday.

Breakout targets met: none

Feb 14th: Markets held on to Friday's gains - treading sideways on lighter volume. In the short term, the Dow ended the day on a small doji as part of a two-day bearish harami - a break of Friday's high negates the bearishness of this candlestick formation, but downside to 10,750 should be watched for. The Russell 2000 MACD trigger line ended smack on resistance - the index closed on a small doji, making it an excellent swing trade at this juncture - trade break of Monday's high/lows. The semiconductor index too finished with a doji, but resistance in its MACD trigger line was breached favoring the bulls to drive this higher towards 454 resistance. The S&P index was the first to show a breakout in on-balance-volume - watch for price action to follow and new highs above 1,219. Secondary tech indicators [$BPCOMPQ, $NASI and $NAA50] have maintained a slight bullish bias over the last couple of weeks - but it wouldn't take more than a couple of days of selling to send these back into the bear column. Markets turning a bullish reversal would show a 45 degree angle of ascent as was seen in the $NASI during August 2004. What we have is a situation of October and November 2004 with the indicators closely hugging their moving averages - a consolidation action and one which should move in the direction of the prevailing intermediate trend, ie. down.

In summary, the tech markets have enjoyed a series of accumulation days supported by a sharply improving semiconductor index. But secondary indicators combined with bearish bullish flags favor short term weakness in the direction of the intermediate trend (down), but this decline should complete the bottom as strength in the Dow, Russell 2000 and S&P helps push these indices upwards.

Breakout failures: BTRX featured on Jan 13th. MYGN featured on Jan 13th.

Breakout targets met: SWB featured on Jan 12th for a 25% gain.

Feb 13th: The tech indices [NASDAQ and NASDAQ 100] added another accumulation day, making it two accumulation days in a row, and the sixth since the market bottomed in January. The bearish flag in the NASDAQ still plays as resistance, but this is not the case for the NASDAQ 100. Unfortunately, the NASDAQ 100 still has to close the breakdown gap from January and remains the weakest index. However, the former disaster zone which was the semiconductor index will create added upside pressure for these indices - the crossover in the +DI/-DI line and the uptick in the ADX shows the bulls in firm control, INTC is a prime example of the positive shift here. As the tech indices lag, the S&P, Dow and Russell 2000 continue to threaten new highs, but all are influenced by bearish divergences in their respective MACD trigger lines. The Russell 2000 sits on the verge of a MACD divergence breakout which could come as early as Monday, the S&P could soon follow - both developments would be very bullish for the markets as a whole. The trade play is to buy pullbacks with stops running at a loss of January lows. Buying breakouts remains risky until market uptrends are resumed.

Breakout failures: FMT clipped its stop at the lows of Friday's bullish hammer at support. The stock featured on Feb 2nd. FRD hit its stop after Thursday's big sell off. The stock also featured on Feb 2nd

Breakout targets met: none

Model portfolio: Added LRT.

Feb 10th: Both the tech indices [NASDAQ and NASDAQ 100] logged an accumulation day following yesterday's losses. Dell's earnings report will pressure these indices tomorrow, although futures as of 1:00am ET were up. The Dow swallowed yesterday's losses with relative ease, but volume disappointed. However, today's gains shifts all of yesterday's volume into the 'longs' column (or, put another way, yesterday's shorts currently sit in the red). The Russell 2000 and S&P had a quiet day. The Russell 2000 held support of the 20-day moving average, while the S&P finished up on light volume. Pecious metal issues continued to gain on volume.

Breakout failures: ARRS featured on Dec 2nd. CCI featured on Nov 10th clipped its stop on the intraday lows. NOOF featured on Jan 7th dived on earnings.

Breakout targets met: none.

Feb 9th: Markets were awoken from the slumber with some big point losses. The NASDAQ 100 and Dow clocked up distribution days to add to the misery. The semiconductor index returned all of yesterday's gains which forced the tech indices [NASDAQ and NASDAQ 100] to break below their respective bear flags. Bulls will look to the rising 20-day moving average/mid-Bollinger band in the semiconductor index for support. Note, the bullish flag breakout is still intact, although the point-n-figure chart shows the SOX firmly in the bear column - it will take a move to 440 to reverse this. No index escaped the sellers wrath. The Russell 2000 and S&P all finished down, although volume in the latter index was average. Some of the early year breakouts are back in reverse as shown by five failures, including one breakout from yesterday, after a relatively quiet start to February. The volatility index began its march to the mid-Bollinger band so expect this downswing to last a few more days. The grey hashed line of the $NAA50 which was support in September and October has turned into pinpoint accurate resistance in January and February - an upside break of this line will be very bullish for the tech markets. Only precious metal issues escaped the selling as gold prices found support at its 200-day moving average.

Breakout failures: DCTH featured on January 21st. TKO featured on January 7th. TNH featured on February 3rd. VICR featured on December 20th. VOCL never got off the ground, selling right off the open.

Breakout targets met: APH featured on October 1st.

Feb 7th: Markets held Friday's gains, trading in light post-Superbowl holiday volume. Futures are slightly down as of 3:00am ET as the Bush budget is digested. The tech indices [NASDAQ and NASDAQ 100] are limping along between 200- and 50-day moving average, although the semiconductor index closed above its 50-day moving average and sits just a couple of points short of its 200-day moving average. A push above 420 sets up a very bullish picture in the tech indices. Small and large caps continue to perform well as marked by the Russell 2000, Dow, and S&P - so there is broad strength in the market, current action fits a bullish consolidation. Key factors changing today were the bullish MACD trigger line crossover in the $BPCOMPQ, and the extension of the volatility index to the lower BB band. The latter looks set for a higher move which will bring either another step in the rally, or a sharp move down (likely to the 200-day moving average). Given that - today's trading looks like an excellent swing trade play trading off the high/lows. Look to the 20-day moving averages for short term support, and the 200-day moving average for the long term buys. Precious metal issues suffered most today, the 200-day moving average for gold will be an important test.

Breakout failures: WTSLA featured on Feburary 1st.

Breakout targets met: none

Feb 6th: The semiconductor index was the end-of-week star, resulting in solid closes for the NASDAQ and NASDAQ 100 above their respective 20-day moving averages. Unfortunately, volume limped in on both indices, although the NASDAQ 100 did break above a bullish flag. The Dow continued its rich vein of form following the bullish 'three white soldiers', closing above the 50-day moving average on heavier (but net average) volume. Technicals all turned green as they did in the S&P. The S&P closed the week at the upper Bollinger band with a rising 20-day moving average - a sign of an intermediate rally in the making. A similar picture is developing in the Russell 2000. Secondary indices [$BPCOMPQ, $NASI and $NAA50] continue to improve. The $NASI MACD trigger line hit a 'buy' on Friday. The angle of ascent of this indicator is not as acute as it was in August (looks more like the angle of October's bounce), so we may still be looking at a a few weeks of sideways action as happened in October before a repeat of the 'Santa rally'. But the rally could have greater legs given it is working from a more oversold level with respect to slow stochastics. The $BPCOMPQ is also moving in a fashion similar to that of October, while the $NAA50 remains below the support line defined by September and October reaction lows.

What of individual stocks on the list, click the link for an annotated stockchart - don't forget to vote when you visit the page. Precious metal stocks suffered most as recent congestions broke down. GSS and KGC took to the brunt of the selling. The former looks to be capitulating with exhaustion gaps showing up on heavier volume as a bullish divergence develops in the MACD trigger line. Pending breakouts are developing in ARIA, CRY, MYGN, ONEI, STNR (but also double top potential here), FIX, ERES, SWN, CPHD, CSTR, LRT, EASI, ELGX, CTCHC (penny), HTM and GEG. Pullback opportunities should be watched for in EGY, AQNT, ISLE, CCK, CRIS, IVAN, and SBAC. Sell signals are popping up in ENWV (close inside the upper Bollinger band following sequence of hanging man and two bearish inverse hammers), and MDR (two inverse hammers on heavy volume with a bearish divergence in the MACD trigger line). Stocks to watch for momentum runs include IMAX, TOA, USNA, WG, CTKH (penny), GZFX (penny), and SIM (could break either way). Stocks to short are DDS, AAII, IIIN and TASR.

Breakout failures: RSYS featured on December 9th.

Breakout targets met: SBL featured on October 28th.

Feb 3rd: Amazon may have depressed the market but afternoon strength prevented any larger point loss. Volume came in higher on the NASDAQ 100 as it reversed off channel resistance. The NASDAQ closed on a small hammer, but as technicals are no longer oversold the bullish implications of this candlestick is reduced. The breakdown gap continues to act as resistance here. The Dow continued to lock horns at resistance, while the S&P held support following its upside channel breakout. Similarly, the Russell 2000 closed with a small hammer at near term support at the upper Bollinger band. The semiconductor index closed for a second day down, but managed to hold support of the mid-Bollinger band (20-day moving average). All eyes on the jobs report tomorrow - this is when we will see some real volume, and a base for market direction. Still pegging on a test of the 200-day moving averages so with this mean a 'bad' jobs report????

Breakout failures: APN featured on Jan 3rd. RATE featured on Jan 11th.

Breakout targets met: none

Feb 2nd: Update to follow.

Breakout failures: KVHI featured on Jan 5th but was stopped out on a low volume pullback.

Breakout targets met: none

Feb 1st: The NASDAQ closed its earlier gap. Slightly higher volume ranks as accumulation, but it lacked the momentum of early January trading. The NASDAQ 100 still has some distance to run to its breakdown gap. The current malaise in the tech indices is heightened by strength in the other indices, including the semiconductor index. The next test of the 200-day average would be an ideal buying point, as is a break of the gap resistance line. The markets look ready to rally given the oversold nature of slow stochastics and improving MACD and on-balance-volume. The question now is where to pick your spot. The Dow closed above near term resistance and followed through on yesterday's gains. Volume was meagre, but the move should be good enough to run to the upper Bollinger band. The S&P may be leading the indices as it breaked bullish flag resistance. Optimists will look for a measured move to 1,390. Cautious players will watch how the index acts at 1,197, 1,206 and 1,214 before getting too excited. The key positive in the indices: price action. The key negative is the lack of volume - but this could also be a positive (low volume may mean no demand, but it also means few sellers).

Breakout failures: AGIS featured on Jan 19th followed with a one day gain on 41%, missing its target by $0.02. The stock then drifted back to its stop price on low volume, it ended today on a bullish hammer but not before hitting its stop price.

Breakout targets met: MATR featured on July 21st, October 14th, and December 20th, overshot its price target to close at $46.00. The stock added another $0.45 today.

Model portolio: USNA added.

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