For the second week in a row all the major averages closed higher. In an exact contrast to last week, it was the Dow Jones Industrials which posted the biggest gains, as it advanced a solid+3.0%. This was the biggest weekly gain for this most popular average since the first week of the new year. The New York Stock Exchange and the S&P 500 Index each added +2.0%, advancing them to near their previous highs. The Nasdaq Composite gained +1.7% as it closed at a new multi-year high.
After some noted improvement the week previous, the market officially got back into rally mode first thing Monday as the Nasdaq traded aggressively higher with an increase in volume. This officially confirmed a new uptrend on what was day 8 of the latest rally attempt. By mid-week the three other major indexes referenced above were all trading back above their respective 50 day moving averages.
As far as buying opportunities; From our watch list of just five highly-ranked stocks, we had a buyable breakout on Tuesday in ENV as shares blasted higher with a +78% increase in volume. This provider of integrated wealth management software was then added to our portfolio. Its’ volume-backed gains continued the following day, and although shares did close off of those mid-week highs, Envestnet, Inc. ended the week up +8%.
One stock is being removed from our watch list as SNTS made some new lows and an effort is being made to be remain particular and focused. I did add three new additions to the watch list this week. Two of these hail from the rising Energy sector and are highly-ranked leaders setting up in technically sound bases. My third addition, also holds many of the winning characteristics in which we are looking for in a buy candidate. Detailed trading criteria for these set ups, along with the three from previous weeks, make up our current watch list which for Premium Members only.
I am still covering a total of seven stocks that had triggered their individual technical buy signals during previous rally runs. Six current holdings such as MX, JAZZ, TRIP, PKG, YNDX, EVR continue, for the most part, to perform rather well technically, while maintaining their high ranks and, at the least, decent fundamentals. One worst performer this week was SSYS as it priced a secondary offering of stock at $93 per share, sending its shares down -5%, to fall below that level.
As I reported last week – “…Monday will mark Day 8 of the current rally attempt. We are watching for a proper Follow-Through Day…” Now that we have that our stance turns offensive with breakouts from our watch list being buyable.
Looking forward to next week, the Fed will meet, so we’ll have to see what happens as far as any news regarding its tapering QE, as that is a major driver of the markets. As is always the case in regards to this part of the markets perpetual bull-bear cycle, we will watch and count any distribution days where there is any above average volume selling which may put this latest conformed rally under pressure.
Until then, another buyable bullish phase is on.