Breakoutwatch Weekly Summary 02/16/19
You are receiving this email because you are or were a BreakoutWatch.com subscriber, or have subscribed to our weekly newsletter. This newsletter summarizes the breakout events of the week and provides additional guidance that does not fit into our daily format. It is published each weekend.
| NASDAQ Attempts Breakout from Cup
and Handle Pattern but Meets Resistance at 200 DMA The NASDAQ (up 2.4%) and other major indexes had a strong week as China trade talks appeared to be moving forward and a Government shutdown was avoided. A slump in retail sales in December was mostly discounted as aberrant as they appeared to show a 3.9% fall in online sales which no one believed. The NASDAQ attempted to breakout from a cup and handle pattern on Wednesday on less than average volume, but as can be seen from the chart below, it failed to breakthrough resistance at the 200 daily moving average level. The low volume throughout the week indicates there is still some caution among traders and the direction of the NASDAQ is uncertain. We continue to measure a successful cup and handle breakout as requiring a 50% volume increase over the 50 DMA as well as closing above the breakout price. For the Volatility Squeeze pattern we only require that the volume 50 dma be met. By these criteria it is not surprising that the number of new breakouts,17, was below last weeks count of 22 due to the falloff in volume.  |
| No new features this week |
|
New Strategies Under Development - Continued
I spent this week thoroughly
examining the backtest code to ensure that the results based
on a backtest of the possible new 'Buy on Breakout Alert' and
'Buy on Confirmed Breakout' strategies were sound. I did find
a bug and I'm correcting the data published last week
accordingly. While not quite so impressive, I think they still
look damned good!
The next step is to publish rules
for the application of these new strategies. Today, I'm going
to focus on the 'Buy on Confirmed Breakout' strategy which I'm
going to call simply the "Buy at Open" strategy as it doesn't
actually require the breakout to be confirmed on volume. It's
also the strategy that is easiest to implement as it doesn't
require following the market in real time. I'll develop rules
for the other strategy in the near future.
The 'Buy on Breakout' Strategy is
explained here.
You will see that I intend to
publish each day two stocks that meet the Buy at Open trade
criteria. This will be done, at least initially, by email to
Test Drive and Platinum subscribers. This will begin after the
site has analyzed the day's trading results on Tuesday,
February 19. This email will also include the trailing stop
values to applied next day for symbols that have already been,
theoretically, bought under the strategy.
I'm also working on a report that
will show progressively trades made under the strategy and
performance of the portfolio.
If you have questions about this
strategy, YOU MUST post them to the Support Forum. I will only
answer questions there to avoid repetition.
|
| List | Breakouts | Avg. Gain |
|---|---|---|
| CWH | 13 | 6.66 |
| SQZ | 4 | 2.38 |
| HTF | 0 | |
| HSB | 0 | |
| DB | 0 |
| Brkout Date | Symbol | Base | Squeeze | Brkout Price | Brkout Day Close | RS Rank* | Last Close | Current % off BOP | Gain at Intraday High |
|---|---|---|---|---|---|---|---|---|---|
| 2019-02-11 | CNST | CWH | n | 9.56 | 9.69 | 95 | 11.93 | 24.79% | 30.23% |
| 2019-02-11 | GTLS | CWH | n | 77.22 | 80.15 | 91 | 88.16 | 14.17% | 15.88% |
| 2019-02-12 | TNDM | CWH | y | 46.00 | 46.45 | 99 | 51.5 | 11.96% | 13.07% |
| 2019-02-11 | CWST | CWH | y | 31.89 | 32.03 | 85 | 35.03 | 9.85% | 10.07% |
| 2019-02-11 | NSC | SQZ | y | 171.47 | 176.95 | 80 | 182.88 | 6.65% | 6.86% |
| 2019-02-11 | TARO | SQZ | y | 98.97 | 104.28 | 81 | 105.15 | 6.24% | 8.05% |
| 2019-02-12 | CRBP | CWH | y | 8.50 | 8.57 | 93 | 8.95 | 5.29% | 7.18% |
| 2019-02-12 | ENSG | CWH | n | 49.99 | 50.75 | 95 | 52.19 | 4.4% | 4.46% |
| 2019-02-13 | NVTA | CWH | n | 15.42 | 15.65 | 98 | 16.08 | 4.28% | 5.38% |
| 2019-02-15 | BL | CWH | n | 49.48 | 51.49 | 92 | 51.49 | 4.06% | 7.03% |
| 2019-02-11 | SE | CWH | n | 15.38 | 15.51 | 93 | 16 | 4.03% | 5.14% |
| 2019-02-11 | QURE | CWH | n | 36.80 | 37.22 | 96 | 37.46 | 1.79% | 8.29% |
| 2019-02-15 | VIAV | CWH | n | 12.67 | 12.8 | 91 | 12.8 | 1.03% | 1.03% |
| 2019-02-11 | OTTR | SQZ | y | 49.90 | 50.02 | 83 | 50.23 | 0.66% | 1.4% |
| 2019-02-15 | LLY | CWH | y | 121.84 | 122.48 | 93 | 122.48 | 0.53% | 0.53% |
| 2019-02-11 | REPH | CWH | n | 8.63 | 8.74 | 81 | 8.67 | 0.46% | 2.76% |
| 2019-02-11 | TRIP | SQZ | y | 59.21 | 59.54 | 89 | 56.81 | -4.05% | 2.52% |
| *RS Rank on day before breakout. | |||||||||
| Symbol | BO Price |
BO Vol. |
Company | Industry | RS Rank |
Last Close |
|---|---|---|---|---|---|---|
| No stocks met our suggested screening factors for
our Cup and Handle Chart Pattern watchlist. See Revised Rules for Trading Cup and Handle Breakouts |
||||||
| Index | Value | Change Week | Change YTD | Trend1 |
|---|---|---|---|---|
| Dow | 25883.2 |
3.09% | 10.96% | Up |
| NASDAQ | 7472.41 |
2.39% | 12.62% | Up |
| S&P 500 | 2775.6 |
2.5% | 10.72% | Up |
|
1The Market Trend is derived from
our proprietary market model. The market model is described on
the site here.
2The site also shows industry rankings based on fundamentals, combined technical and fundamentals, and on price alone. The site also shows daily industry movements. |
||||
| 1 Week | 13 Weeks | 26 Weeks | Year-to-Date |
|---|---|---|---|
| Dow Jones |
NASDAQ Composite 1.85 % |
Dow Jones 0.83 % |
NASDAQ Composite 12.62 % |
| 1 Week | 3 Weeks | 13 Weeks | 26 Weeks |
|---|---|---|---|
| Foreign Utilities |
Foreign Utilities |
Foreign Utilities |
Auto Parts Stores |
| Security Software & Services 96 |
Music & Video Stores 213 |
Synthetics 210 |
Music & Video Stores 213 |
| Charts of each industry rank and performance over 12 months are available on the site | |||
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