For the last several weeks I have expected the markets to rally up to 8000 resistance on the DOW and up to around 900 resistance on the S&P. Once this rally occurs then the jury would be out. As the data shows, we were successful in our prediction.
Starting today, I was expecting a continued rally through earning season completion where I believed we could sit above 8000 as support and get above that short-term 877-880 resistance on S&P. This predicted resistance would then provide future support to break above 900 on the next leg up. Well, I didn’t expect a swine flu scare to drop us from these most recent highs. The potential for a pullback after earnngs season had ended was my plan of attack. That’s the stock market for you. Adapt or perish!
Some of my thoughts have come to pass. The information below shows my previous ideas that have born fruit (copied from prior posts because I hate typing). Please note that these stocks and sectors have been leading us up from our lows. Alos, Internet Retail is a not a known indicator. I discovered this works in troubled times.
Prior comments from March 24th
I wrote previously about my Google, Amazon, Yahoo theory – if these stocks start to perform and improve on an earning power (ALPHA) and technical basis, the overall markets will get better. I already see evidence that this is being achieved. I would like to add that, if technology starts to kick in, we will start to move up substantially. If you look strictly at the data, you cannot ignore that the sectors with the greatest earning power increase are the technology groups. In addition, you have Regional Banks, Restaurants, and Specialty Retailers picking up some steam. I posted several ideas of stocks in these sectors over the last several months. The Obama Healthcare plan put a scare into the healthcare sector and their stocks, but this could give us some select opportunities as well.
Stocks for consideration this week
Sector
Stock Symbol
Software
ETF, IGV
Beverage
CCE
Oil and Gas Drilling
PDE
Wireless Telecom
AMT
Packaged Food
MKC, HRL
Utilities, Multi
PCG
Integrated Telecom
TWTC, CTL
Life Sciences
CRL
Heavy – Electrical and Equipment
ESE
Application Software
FDS
Semiconductor
XLNX
End of Prior comments
Some of these stocks and sectors have gotten a little extended and may need some time to consolidate before a secondary move up. Usually, the second move up is more powerful than the first technical breakout move. (Many more stocks and sectors have been posted for clients and Evaluvest members access).
Looking at the data on most DOW components, we seem to have achieved a quantitative bottoming out (ALPHA) and have gone through a technically exhausting selling process which seems to be in a consolidation mode for most of the depressed DOW components. Looking at INTC and MSFT I am seeing constructive activity. I’m looking at the financials and seeing constructive activity. I’m looking at aerospace seeing constructive activity. Dare I say that the financials are beginning to show some type of ALPHA to support their dead cat technical bounces?
Sector Talk
If you go strictly on the data you cannot deny that a sector like Aerospace is showing some life after Obama’s defense budget scares fade. Most banks like regional, diversified asset management, financial services, consumer finance and data processing are improving and possess some opportunity at these levels. They should not be bought after big moves up. They should be bought close to their 21-day moving averages. Internet software and services still looks good and I expect to see a nice ramp up in several of these stocks if the recovery stays intact. Random sectors like Pharmaceuticals, Retail Food, and Air Freight are also heating up with one or two interesting stocks to consider.
Stocks and sectors of interest
Lets take a look at:
Healthcare services
RSCR
Healthcare supply
IMA
Pharma
LLY
Insurance, Life and Health
DFG
Financials
Diversified Banks- WFC
Financial Services-BAC
Regional Banks-PRSP, WABC
Consumer finance-DFS
Asset Management-AMP
Financial ETF-IYG
Retail-Computer and Electronics
GME
Retail-Internet
GOOG
NTRI
Communication and Equipment
QCOM
CIEN
GLW
Specialty Chemicals
SIAL
Air Freight and Couriers
UTIW
Trucking
WERN
Aerospace and Defense
GR
AXYS
Please remember I have strict rules when to buy and sell these stocks. If you do not have access to these rules, please request a free copy of my book Pizzuti Power at www.pizzutipower.com
This entry was posted
on April 27, 2009 at 11:11 pm and is filed under Weekly Market Commentary.
You can subscribe via RSS 2.0 feed to this post's comments.
Stock Market Analysis – Week of 4/27/2009
For the last several weeks I have expected the markets to rally up to 8000 resistance on the DOW and up to around 900 resistance on the S&P. Once this rally occurs then the jury would be out. As the data shows, we were successful in our prediction.
Starting today, I was expecting a continued rally through earning season completion where I believed we could sit above 8000 as support and get above that short-term 877-880 resistance on S&P. This predicted resistance would then provide future support to break above 900 on the next leg up. Well, I didn’t expect a swine flu scare to drop us from these most recent highs. The potential for a pullback after earnngs season had ended was my plan of attack. That’s the stock market for you. Adapt or perish!
Some of my thoughts have come to pass. The information below shows my previous ideas that have born fruit (copied from prior posts because I hate typing). Please note that these stocks and sectors have been leading us up from our lows. Alos, Internet Retail is a not a known indicator. I discovered this works in troubled times.
Prior comments from March 24th
I wrote previously about my Google, Amazon, Yahoo theory – if these stocks start to perform and improve on an earning power (ALPHA) and technical basis, the overall markets will get better. I already see evidence that this is being achieved. I would like to add that, if technology starts to kick in, we will start to move up substantially. If you look strictly at the data, you cannot ignore that the sectors with the greatest earning power increase are the technology groups. In addition, you have Regional Banks, Restaurants, and Specialty Retailers picking up some steam. I posted several ideas of stocks in these sectors over the last several months. The Obama Healthcare plan put a scare into the healthcare sector and their stocks, but this could give us some select opportunities as well.
Stocks for consideration this week
End of Prior comments
Some of these stocks and sectors have gotten a little extended and may need some time to consolidate before a secondary move up. Usually, the second move up is more powerful than the first technical breakout move. (Many more stocks and sectors have been posted for clients and Evaluvest members access).
Looking at the data on most DOW components, we seem to have achieved a quantitative bottoming out (ALPHA) and have gone through a technically exhausting selling process which seems to be in a consolidation mode for most of the depressed DOW components. Looking at INTC and MSFT I am seeing constructive activity. I’m looking at the financials and seeing constructive activity. I’m looking at aerospace seeing constructive activity. Dare I say that the financials are beginning to show some type of ALPHA to support their dead cat technical bounces?
Sector Talk
If you go strictly on the data you cannot deny that a sector like Aerospace is showing some life after Obama’s defense budget scares fade. Most banks like regional, diversified asset management, financial services, consumer finance and data processing are improving and possess some opportunity at these levels. They should not be bought after big moves up. They should be bought close to their 21-day moving averages. Internet software and services still looks good and I expect to see a nice ramp up in several of these stocks if the recovery stays intact. Random sectors like Pharmaceuticals, Retail Food, and Air Freight are also heating up with one or two interesting stocks to consider.
Stocks and sectors of interest
Lets take a look at:
Healthcare services
RSCR
Healthcare supply
IMA
Pharma
LLY
Insurance, Life and Health
DFG
Financials
Diversified Banks- WFC
Financial Services-BAC
Regional Banks-PRSP, WABC
Consumer finance-DFS
Asset Management-AMP
Financial ETF-IYG
Retail-Computer and Electronics
GME
Retail-Internet
GOOG
NTRI
Communication and Equipment
QCOM
CIEN
GLW
Specialty Chemicals
SIAL
Air Freight and Couriers
UTIW
Trucking
WERN
Aerospace and Defense
GR
AXYS
Please remember I have strict rules when to buy and sell these stocks. If you do not have access to these rules, please request a free copy of my book Pizzuti Power at www.pizzutipower.com
Steve Pizzuti
This entry was posted on April 27, 2009 at 11:11 pm and is filed under Weekly Market Commentary. You can subscribe via RSS 2.0 feed to this post's comments.
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