– 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.
6:30 AM – MORNING MARKET UPDATE & WATCH LIST
SEE ALL MY CURRENT WATCH LISTS HERE: James’ Stock WatchLists
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esterday, the market extended its win streak with each of the major averages posting gains of better than +1%.
This morning, European markets opened higher following a positive trading session in Asia.
QUOTE OF THE DAY:
“Your positive action combined with positive thinking results in success.” – Shiv Khera
The current round of trade talks between the United States and China have concluded in Beijing, according to China’s Foreign Ministry.
It was announced the talks would be extended for a third day, a decision that was interpreted as a sign that discussions were moving in a positive direction.
The U.S. Federal Reserve will release minutes from its December meeting on Wednesday.
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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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It’s already been a busy 2019 as we have had 3 breakouts, each from several of my watch lists. There has also been 1 short, which triggered Tuesday, from the two stocks which I had on the ShortSetUps WatchList.
Below is an update on all 4 of these stocks which have been our only actionable trades so far this week.
On Monday, we had two breakouts confirm a BUY signal as both DORM and FIVN traded above their posted TRIGGER PRICE while also making their TRIGGER VOLUME.
Shares of DORM quickly started trading higher on Monday’s open, with a sharp increase in volume. This bullish action triggered a BUY signal as price rose above the posted TRIGGER PRICE of $91.42 mid-morning, while volume was well on pace to make the stock’s TRIGGER VOLUME.
Unfortunately, the stock did pull back that afternoon and close the breakout day below the TRIGGER PRICE. Of course, this is never a good sign. So, that was already 1 technical strike for this breakout.
Tuesday’s action did not add any reassurance as shares closed down another -1% with volume up +85%. The stock closed just under its 1st SUPPORT. Any further declines would be tough to tolerate.
Chart courtesy of stockcharts.com
FIVN is from the TrendLine SetUps WatchList and it broke out Monday morning with gap open – backed with a +113% increase in volume. The stock made some decent follow-through gains Tuesday, with continued volume conviction, and a close at the session highs (+2.3%). Looks poised to move higher as soon as Wednesday morning.
Chart courtesy of stockcharts.com
From the Technical SetUps WatchList we had CIEN also broke out on Monday. Volume was not as much as we normally like to see being only +15%, however, lower volume breakouts can still work out in an up-trending market.
Chart courtesy of stockcharts.com
On Tuesday, we had one of the two stocks which were on the ShortSetUps WatchList trigger a SHORT by default as shares of ANTM headed lower.
Volume on the session showed a +78% increase above normal levels. However, the fact that shares closed well off of the session lows, is a concern, especially considering the present bullish environment.
Further upward trading tomorrow would be a concern, any gains above the 200-day moving average ($253.10) would be an appropriate place to cover with a manageable -3%~ loss.
Chart courtesy of stockcharts.com
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Regardless of market conditions, I am always preparing a watch list of high-ranked leaders which are building bullish technical bases.
This morning, I ran my routine stock screens, yet did not find any new stocks to add to our watch lists.
We have a total of 9 stocks which we will be watching for a potential breakout.
SEE ALL MY CURRENT WATCH LISTS HERE: James’ Stock WatchLists
Now you can get 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.
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.
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.
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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.