MON 10/1: Futures Sharply Higher – Payment Processor Sets Ups
– James F. Taulman, former Editor-in-Chief of the first independently licensed website to offer stock reports and services based on the CAN SLIM® investment system.
9:00 AM – MORNING MARKET UPDATE & WATCH LIST
NOTE: Today’s watch list can be found here.
[dropcap]U.[/dropcap]S. stock futures are sharply higher this morning with the Dow’s up +165.
QUOTE OF THE DAY:
“Nothing is a waste of time if you use the experience wisely.”
– Auguste Rodin
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Technical SetUps WatchList Each Market Morning
Early each market morning James diligently screens through hundreds of high EPS and RS ranked stocks that have solid fundamentals.
He is looking for those select few which are setting up in sound technical bases and which looked poised to breakout that day.
Each stock is listed with specific trading criteria such as a TRIGGER PRICE, TRIGGER VOLUME and MAX BUY PRICE.
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On Friday, the major averages may have finished the week and month with a whimper, but each booked strong gains for the third quarter of 2018.
Over the past three months, we’ve seen the major benchmarks clamber back to new all-time highs, as investors focused on solid domestic economic health, while shaking off trade tariff tensions.
During that time the S&P has risen more than +7%, which is its biggest quarterly advance since the fourth quarter of 2013, while the Dow gained about +9%. Both indexes have now risen 11 of their past 12 quarters. The Nasdaq is also up more than +7% over the quarter, and made its ninth straight quarterly gain.
On the month, the Dow gained +1.9%, as the S&P 500 added +0.4%, while the Nasdaq actually edged down –0.8%.
Recent sessions have been relatively quiet as the trading range has been rather tight. The benchmark S&P has not closed with a move of even 0.5% in either direction any day this week. On the week, the Dow lost -1.1%, S&P 500 gave up -0.5%, while the Nasdaq gained +0.7.
This recent advance in the market is much broader than one might have anticipated in a late-stage expansion.
The market closed out the quarter against a comfortably bullish technical backdrop.
The recently lagging Nasdaq Composite is now nearing another possible breakout — challenging its range top (8,042) — while the S&P 500 and Dow industrials continue to digest previously decisive breaks to record territory.
Chart courtesy of stockcharts.com.
I ran my routine stock screens over the weekend and added 5 new stocks to our watch list.
We now have 13 stocks which we will be watching for the next buyable breakout – see here.
One of those is TSS which is setting up in a base. This Payment Processor is highly ranked and was previously on our watch list earlier this year and broke out.
Chart courtesy of stockcharts.com – Click chart to enlarge.
Standard rules apply – any gains above the stock’s TRIGGER PRICE while the day’s volume is at least on pace to make the TRIGGER VOLUME would have any of these set ups confirming a BUY signal up to their MAX BUY PRICE by default.
Keep in mind that when a stock breaks out – becomes potentially buyable – there are other factors to consider.
Volume on the breakout. A stock that is breaking out through resistance, with an increase in volume of +50% above the stock’s average volume (50 DAV), is showing more conviction and more demand. This is not saying – all lower volume breakouts will fail. Actually, we’ve seen many continue higher. If you have found that you did buy a stock that showed lower daily volume or volume under 50%, going forward – simply treat it a regular trade.
Earnings BreakOuts. Many stocks from our watch list will break out during earnings season. Earnings breakouts can be more rewarding, however, these trades carry much more risk then traditional (non-news) breakouts. One needs to also consider – the strength/weakness of the fundamental news that was just released along with the forward-looking guidance the company gave, investors response to the conference call, etc. For anyone who is not familiar with – buying earnings breakouts – I suggest that they sit through a few seasons to study, paper trade, and show some profits, before applying actual capital.
Current Portfolio Members can access all watch lists with updated trading criteria including – TRIGGER PRICE, TRIGGER VOLUME, and MAX BUY PRICE for every stock here.
Missed any of these morning reports? You can find all previous reports here.
As always, if anyone has any questions – please feel free to email me at james@jamestaulman.com as I would be glad to assist you. _________________________________________________
About the Founder: 
James F. Taulman – James served as Editor-in-Chief of the first independently licensed website that offered stock reports and services based on the CAN SLIM® investment system. He has developed a knack for being able to quickly and accurately analyze high-ranked stocks based on this winning investment strategy. Over the years, Mr. Taulman has enjoyed assisting individuals from professional money managers to private investors with their needs in relation to implementing this investment approach on a daily basis in the current marketplace. Each Sunday you could hear him deliver his weekly market report as part of the “Your Money Matters” radio program on ABC and CBS radio networks. _________________________________________________ Disclaimer: James Taulman is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The independent contractors and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company’s website, or in its publications, are made as of the date stated and are subject to change without notice. It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company’s products (collectively, the “Information”) are provided for informational and educational purposes only and should not be construed as investment advice.