MLR - Premarket Pulse 7/29/13

Published : July 29 2013 at 9:25 ET

Major averages recovered after being down most of the day Friday to close up. A number of stocks we have mentioned in our actionable reports have continued higher. This is always a good sign as it shows some high quality stocks are advancing after their buy signals. Of course, for those that lag or fall, it is best to keep stops tight so you can redeploy the capital into a different high quality stock that may work well. Buying stocks such as TSLA and VIPS at the price at which we reported them as buyable gap-ups or pocket pivots can make a nice difference in any portfolio. (AMZN), which had sold off after announcing earnings Thursday after the close, recovered after finding support at its 20-day moving average. The stock closed above its 10-day moving average for a continuation/supporting type of pocket pivot.

As earnings season continues, investors should be alert to potential buyable gap-up situations emerging following a positive earnings announcement, as this is often the best way to get on board a leading stock without having to endure the risk and uncertainty of holding through earnings if one does not have a profit cushion in a particular stock.

The Market Direction Model remains on a buy signal as the market works through a roughly two-week consolidation after moving up sharply off of its lows of June 24th. Some backing-and-filling might be expected as earnings season continues.

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