Investor Spotlight

How Strong is Your Stock Watch List ?

"It seldom pays to invest in laggard stocks, even if they look tantalizingly cheap. Look for, and confine your purchases to, market leaders"

By Mr. William J. O'Neil (Founder of Investors Business Daily)

Market trend has been in correction since May 13th. That was the time to scale back the exposure in the market and start raising CASH. It was a very nasty week last week. The 3 major indexes have now plummeted down to the 200 day sma(simple moving average). Institutional investors usually support the market at this level. For individual investors, it's going to be a "Wait and See" situation this week. We could be just 4 days away from the market declaring a "Follow Thru" day. One can't predict the market but as a retail investor one can TIME the market. According to Mr. William J. O'Neil (Founder of Investors Business Daily), one should always buy something on a "Follow Thru" day. That is the ideal TIME to start initiating a stock position in the leading stocks.

I had published a partial list of 14 stocks in my blog post last week with the resistance levels identified. This is the time to be refining the stocks on the watch list and identify the true leaders. If and when IBD(Investors Business Daily) changes the market pulse to "Market in Confirmed Uptrend", you should have a list of stocks that are the true leaders in the market. As a growth stock investor and a trader, you don't want to be buying stocks that are cheap or hovering below the 50 day sma. Comparing the performance of the stocks on your stock watch list against the 3 major indexes I monitor is the one of the quickest ways to identify if your stocks are leaders or laggard.

Here is the performance of my 14 stocks for last week as compared to the 3 leading indexes:

Indexes:

$DJI ... - 3.01%
$SPY ... - 2.66%
$QQQ ... - 2.36%

These indexes have plummeted below the 200 day sma last week.

My Stock Watch List:

$CYBR ... - 1.39%
$LULU ... - 4.16%
$MA ... + 0.004%
$MNST ... - 2.46%
$NOW ... - 2.61%
$OLLI ... - 2.67%
$PAYC ... + 1.86%
$PYPL ... - 0.09%
$TEAM ... - 2.82%
$TWLO ... - 1.43%
$V ... - 0.81%
$VEEV ... + 15.67%
$VMW ... - 10.61%
$ZS ... - 3.52%

Average performance of all 14 stocks last week ... - 1.22%. They held up well while the indexes fell apart in declining market.

Average price of the 14 stocks on watch list ... $150.90

11 of these stocks are currently hovering at the 20 day sma. That is a sign of institutional support. They are indicating an interest in acquiring these stocks and building a larger position.

Just 3 stocks are below the 50 day sma but no where close to the 200 sma where the the 3 major indexes are currently. Institutions are still supporting these stocks while dumping and taking profits in their other holdings. Retail investors should be buying what the institutions are buying.

These are truly the leading stocks and they are certainly not cheap. Growth stocks strategy is:

Buy High and Sell Higher
Buy only the leading Stocks in the Leading Sector
Buy stocks that are above the 50 day sma at its correct buying point.

Mentoring Program

I shall be opening up a few slots over the summer months in my Mentoring Program. June thru September are slow months usually in the market. Historically our best quarter is from October thru Dec. Now is an ideal time to learn to trade and invest utilizing growth stock strategies of IBD(Investors Business Daily).

Schedule a FREE 30 minutes of "Discovery Call" with us and investigate how our program can help you learn the basics of reading the Stock Charts:

How to find the winning Growth Stocks?
How to Buy the Stocks Right?
How to Sell the stocks Right?
How to TIME the market?
How to protect and harvest your profits?