The NASDAQ Composite set a new high on Wednesday but traders were uncertain that the high would hold resulting in a "Doji" candlestick pattern(see chart below). The "Doji" pattern indicates uncertainty about the future direction as the pattern shows an almost equal open and close but with trading above and below during the session. Thursday resolved the uncertainty to the downside as Greece postponed a debt payment to the IMF but a strong jobs report on Friday allowed the index to close for a small 0.2% gain. Overall, the index closed the week for a very small 0.03% loss. While our trend indicators for the NASDAQ and S&P 500 remain positive, the signs of an improving economy are sure to rekindle worries that the Fed will soon begin to raise interest rates with a negative effect on market sentiment.

New Volume Filter on Long Watchlists.

We have commented before (most recently 5/815) that a surge in volume accompanied by improving price before breakout can indicate a strong breakout to come). AXDX (see below) provides another example of this. To permit the easy recognition of above average volume, I've modified our watchlist filters to allow the selection of stocks with an above average volume on the date of  their listing on the watchlist. Simply set the new filter to 'yes' and the watchlist (and alerts if you so specify) will be limited to those that have an equal or above average volume and improving price on the date the watchlist is published.

At Least Average Volume on Watchlist Date Forecasts Strong Breakout

AXDX was list on our cup and handle pattern watchlist on 06/02/03 with a volume 1.6 times the 50 day average. The stock was also marked as being in a volatility squeeze. We issued an alert the next day, 06/03/15 at 10:27 and a price of 24.08. Although  the stock closed above its pivot price we did not recognize it as a successful breakout because the volume failed to meet  the 1.5 times ADV requirement.