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Focus List Review - Week Ended September 30, 2016

Current VoSI Focus List

NotesOverall the Focus List acted well during what was a volatile week for the major market indexes. We continue to take an opportunistic stance towards pullbacks in this market, seeking to use constructive action as a stock comes down into a potential area of support as lower-risk entries.

Pocket pivots: BIIB (Friday)

Constructive pullbacks to or tight action around the 10-day simple moving average: EW, FN, GIMO, GRUB, MELI, STSK.

Constructive pullbacks to or tight action around the 20-day exponential moving average: EDU, FB, MOMO, NTES, SQ, VEEV (supporting action), VUZI (pullback and support).

Constructive pullbacks to or tight action around the 50-day simple moving average: ALGN, AMWD, AVGO.

Of Note:

Fitbit (FIT) sold off hard on a reaction to an analyst's report of weak Christmas sales. This sent the stock right down to is 50-day moving average on heavy selling volume. This is a sell-off on news, and other sources are disputing the method with which the analyst in question "calculated" these forward sales numbers. Generally, if such news hits a stock and turns out to be overblown, the stock will bounce back rather quickly. With FIT right under the 50-day line, we would watch for any recovery back above the line as a possible opportunistic entry, with the idea of using the 50-day line plus an additional 2-3% of downside porosity as a tight selling guide. 

Line (LN) posted a buyable gap-up type of breakout on Tuesday, as we noted in a pocket pivot update on the same day. It has now drifted back down towards the 48.20 intraday low of Tuesday's buyable gap-up price range. This brings the stock into a lower-risk buyable position using the 48.20 price level, plus another 1-3% of downside porosity as a tight selling guide.

Twilio (TWLO) had a sharp pullback to its 10-day moving average on Friday on very heavy selling volume. It is not clear whether this was related to quarter-end activity. A low-volume pullback would have been preferable to see, but with the stock holding above the 10-day line by the close on Friday, it could present a lower-risk re-entry if one sold into the prior base breakout earlier in the week. In this case the 10-day would provide a very tight, nearby selling guide. ACIA and TWLO have been the IPO price leaders so keep a close eye on ACIA as well as it approaches its 50-day line.

Weibo (WB), which posted a pocket pivot on Wednesday, has pulled back to the 20-day moving average, which brings it into a lower-risk entry position. However, volume was above-average on Friday, which is not ideal. This could, however, be related to quarter-end activity, and the volume, while above average, was still lighter than Tuesday's pocket pivot. For this reason the stock can be considered to be in a lower-risk buy position on the basis of Tuesday's pocket pivot, using the 20-dma at 40.95 as a tight selling guide. 

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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