PPR - NetSuite, Inc. (N) Pocket Pivot and Buyable Gap-ups in JDSU and FNSR

Published : February 5 2011 at 12:53 ET

NetSuite, Inc. (N) staged a buyable pocket pivot reversal as it sold off initially on earnings before turning back to the upside after finding strong volume support at its 50-day moving average and then closing well above its 10-day moving average, as we see in the chart below. This is buyable using the 50-dma as a guide for a stop.

Also, this PPR alert marks the first time we will start identifying Buyable Gap-Ups (a "BGU" for short) within the scope of the Pocket Pivot Review alerts section. Often Buyable Gap-Ups are also pocket pivots, so we are now alerting members to Pocket Pivots and BGUs via the PPR alerts. This week we saw two buyable gap-ups in the Telecommunications - Fiber Optics groups, JDS Uniphase (JDSU) and Finisar (FNSR). We would use the Friday intra-day lows of 21.03 on JDSU and 37.47 for FNSR as guides for stops. The chart of FNSR, below, shows that the stock did have a buyable gap-up back in early December, and the stock has nearly doubled since then. Keep in mind that both of these current gap-ups, JDSU and FNSR, have occurred after some extended upside moves, so while they may result in some continuation to the upside from here, we would still like to see these stocks build bases somewhere in here, hence these gap-ups may contain more risk. Nevertheless, we think the strength in this area is something to take notice of and have decided to include them in this, our first discussion of BGUs. Again, we would like to thank our friends at HighGrowthStock Investor software (www.highgrowthstock.com) for giving us blanket permission to use their excellent charts and data on VirtueofSelfishInvesting.com. These charts are both Copyright 2011 by HighGrowthStock Investor and are used by permission.


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