MLR - PMP 1/17/14

Published : January 17 2014 at 8:58 ET

The major market averages barely budged yesterday on lower volume. General Electric (GE) was down slightly and Morgan Stanley (MS) up slightly after reporting earnings. We last reported on MS when it had a pocket pivot on November 11th. GE's report was overall favorable as they reported higher earnings and revenue amid strong orders and a record backlog for the fourth quarter. Earnings overall continue to be strong for this quarter as perception that the economy might be turning the corner, whether true or false, helps guide prices higher. Quantitative easing also helps not just higher stock prices but also puts a floor under how far stocks fall.

Prescription drug maker Questcor Pharmaceuticals (QCOR) had a pocket pivot coming up through its 50-day moving average as it tries to round out the lows of a potential new base. Group rank is #3, earnings and sales are in the high double-digit percentages, pretax margins are 61%, and ROE is a very strong 109.9%.

LinkedIn (LNKD) cleared enough volume for a pocket pivot yesterday as it tries to come up the right side of a potential new base. Prior to yesterday's pocket pivot, LNKD had put in three waves of selling within its pattern, with the last wave taking the stock below the 200 price level and the 200-day moving average. Group rank is #4 as the stock has maintained robust earnings and sales throughout a long basing process.

Fellow social-networker Twitter (TWTR) cleared a 61.57 shakeout-plus-three buy point yesterday but backed down a little over 1% by the close to remain within range of its 10-day moving average. This morning TWTR is gapping up above the 63 level which will clear the 10-day moving average and set up a potential pocket pivot move if volume can exceed 31,806,111 shares, the highest down-volume in the stock over the prior 10 trading days.

Solar stocks extended their gains with the big leaders, Canadian Solar (CSIQ) and SolarCity (SCTY), both of which we reported on previously at much lowere price, being joined by Sunpower (SPWR) which broke out yesterday on a pocket pivot move. Group rank #2 with earnings soaring.

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