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Market Lab Report - Pocket Pivot Review for the Week Ended December 9, 2016

Notes from Gil and Dr. K regarding Pocket Pivot Reports that were sent out during the week of December 5-9, 2016:

SunCoke Energy (SXC)

GM - SXC posted a pocket pivot on Monday, after which it moved higher, but is now pulling in towards the 10-day moving average at 12.18. The stock closed Friday 34 cents above the 10-day line, which brings it into a lower-risk buy zone using the 10-day line as a tight selling guide.

Dr. K - Coal has been the top performing industry group for many weeks. SXC has powered higher and is offering a low-risk entry point using the 10-day line as a selling guide, and a moderate-risk entry point using the 20-day line which sits about 5% away from Friday's closing price. 


Mosaic (MOS)

GM - MOS was within buying range of the pocket pivot breakout move of seven trading days ago on the chart when we put our report out on the stock Tuesday afternoon. The stock has since traded much higher and is now extended.

Dr. K - Here is a "stuff" stock that has done well, but is too extended at this point from the time we notified members.


Zillow (Z)

GM - Z is pulling in quite constructive after Wednesday's powerful pocket pivot and breakout type move. Volume has dried up sharply on this pullback, putting the stock in a very low-risk entry position using the 10-day line at 35.92 as a tight selling guide.

Dr. K - Note that the 10-day will creep higher in the ensuing days (as all moving averages do) so adjust your stops accordingly. Some may wish to use a 1-2% undercut of the 10-day line as their stop while others may wish to use a smaller undercut as their stop.


Square (SQ)

GM - SQ is holding most of its gains after Wednesday's strong mini gap-up move. Volume is drying up sharply, which is constructive and keeps the stock in play as a long using the 13.40 intraday low of Wednesday as a reasonably tight selling guide for this low-priced cloud leader.

Dr. K - One could also use the 10-day as a selling guide. On Monday as it moves higher, it looks as if it will be just under Wednesday's low. 


Arista Networks (ANET)

GM - ANET had a strong pocket pivot move on Wednesday, but as is typical with this stock it has since pulled back just below its 10-day moving average as volume has declined sharply. This creates a lower-risk entry opportunity on the basis of Wednesday's pocket pivot. I myself would use the 20-day line at 92.57 as a tight selling guide.

Dr. K - In its prior run from Aug - Sep, ANET bounced off its 20-day line. undercutting it by 0.9%. One could use a similar undercut of no more than 1-2% below the 20-day line as a sell stop.


JD.com (JD)

GM - JD has posted three pocket pivots along its 50-day moving average over the past month or so. On Friday the stock pulled back into the 10-day moving average on light volume, creating a low-volume entry opportunity on the heels of our report, which was sent out on Wednesday. The stock held well and closed near the top of its intraday price range in constructive fashion.

Dr. K - After posting two pocket pivots in November, JD undercut its 50-day line in both instances. Given that it closed near the top of its trading range of Friday, it can be bought. One could keep stops extra tight using any undercut of the 10-day line as a stop. Alternatively, one could use the confluence of the 3 moving average lines as a stop, which would place it at roughly 26. Investors wishing to give it more room could use a 1.5% undercut of the 50-day line as a stop given that it undercut its 50-day by no more than 1.5% the prior two times it fell below its 50-day line after posting pocket pivots.

This information is provided by MoKa Investors, LLC DBA Virtue of Selfish Investing (VoSI) is issued solely for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of available data. VoSI reports are intended to alert VoSI members to technical developments in certain securities that may or may not be actionable, only, and are not intended as recommendations. Past performance is not a guarantee, nor is it necessarily indicative, of future results. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Entities including but not limited to VoSI, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Additional information is available upon written request. This publication is for clients of Virtue of Selfish Investing. Reproduction without written permission is strictly prohibited and will be prosecuted to the full extent of the law. ©2024 MoKa Investors, LLC DBA Virtue of Selfish Investing. All rights reserved.
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