MLR - PMP 12/3/13
Major averages fell on higher volume compared to Wednesday and Friday trading volumes. Both days are traditionally lighter volume days due to the Thanksgiving holiday weekend. Volume overall was below average. Leading stocks continue to lag the major averages, though with a couple exceptions, underscoring the importance of picking the right stocks.
Chinese real estate website Soufun (SFUN) had a pocket pivot. Earnings and sales are robust, institutional sponsorship has grown last 3 quarters, pretax margin 51.4%, ROE 125%. SFUN provides real estate marketing, listings, and other data through its site.
Acadia Pharmaceuticals (ACAD) had a pocket pivot. It has had an exponential ascent, so its two big volume down days are understandable given the overall context of when they occurred. ACAD makes small molecule drugs for the treatment of CNS disorders.
Fracking company US Silica Holdings (SLCA) had a pocket pivot. One might think it is extended from the 10-dma and also didnt break out. But in context with where its trading relative to its base, the pocket pivot is valid. Also, while it did close midbar, it is most likely due to the general market pulling back. We have reported on SLCA in prior reports.
Gogo (GOGO) had a pocket pivot. GOGO provides wifi access on airlines. GOGO earnings are currently negative, though sales have been accelerating with the most recent quarter up 48%. The overall chart formation is constructive but take into account that this stock has yet to earn anything for at least 2014, and the space could be quite competitive as larger companies could barge into GOGO's space to arrange contracts with major airlines. It is also volatile so position size accordingly. We reported on GOGO in prior reports including on its pocket pivot and buyable gap up in early November.
NXP Semiconductors (NXPI) had another pocket pivot yesterday within a short four-day range since last week's pocket pivot which we reported on. The stock has found some resistance at the prior highs and appears to be setting up for a breakout.
Tesla Motors (TSLA) is gapping up nearly 5% this morning after Morgan Stanley named it a "top pick." TSLA is not in a proper position for a buyable gap-up, although high short interest could cause the stock to bounce further if shorts scramble to cover.
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