Current Focus List
The VoSI Focus List is a compilation and reference list of stocks for which Pocket Pivot or Buyable Gap-Up Reports have been issued and which have been deemed suitable for inclusion on the Focus List. Not all stocks for which a Pocket Pivot or Buyable Gap-Up report has been issued will necessarily be added to the list. It is not intended as a "buy list" or a list of immediately actionable recommendations. Stocks on the list may or may not be in proper buy positions, and investors should exercise discretion and proper judgement in determining when and where stocks on the Focus List can be purchased. The following notes are intended to assist in this process. Please note that members can enlarge the Focus List image by clicking on the body of the email and then holding the Control Key while pressing the "+" key until it is large enough to read.
General Observations:
The big-three major market indexes all corrected over 10%, marking the fastest 10% decline off the peak in market history. It was not until the NASDAQ Composite Index reached its 200-dma that the market was finally able to make a stand after the S&P 500 and Dow Indexes had previously closed below their own 200-dmas. This may trigger an oversold reaction rally from here given how extended the indexes have become over the past week. Such a rally could carry the NASDAQ Composite back up towards its 50-dma and may offer swing-trading opportunities under the right conditions.
The Market Direction Model (MDM) remains on a BUY signal. Deeper discussion on the model, market direction, market history, and the corona virus situation HERE.
Focus List Stocks Expected to Report Earnings this Week: None.
Notable Action:
Virtually all stocks' chart patterns are busted, so to speak, but as they plumb the lows of their patterns potential swing-trading opportunities may arise. These are mostly appropriate for nimble traders who understand OWL methods, such as the undercut & rally set-up and are prepared to engage in very short-term swing-trading activities. Very few names on the Focus List qualify, however, as the action over the past week has been quite deleterious with stocks crashing through near-term support like knives through butter, triggering trailing stops which should have members sitting mostly, if not entirely, in cash.
Activision Blizzard (ATVI) has undercut and rallied back above three prior lows in its pattern.Technically, this can be acted on for at least a potential swing-trade up to its 50-dma using the lowest of the three prior lows at 57.37 as a tight selling guide.
Biogen (BIIB) has pulled into its 50-dma and the top of its prior base, where it offers a potential lower-risk entry using the 50-dma as a tight selling guide.
Shopify (SHOP) has posted a U&R move through its prior 436.74 low and the 50-dma. This offers a potential lower-risk entry using the prior low as a tight selling guide or the 50-dma as an even tighter selling guide.
Tesla (TSLA) found support at its 50-dma on Friday, but is now 10% extended from the line, hence out of buying range. Constructive retests of the line could offer potential lower-risk entries, but these would have to occur within the proper general market context. A market bounce and rollover to lower lows would likely take TSLA below its 50-dma, so this should be watched carefully as a critical support level.
The massive forced selling that ensued as a result of the record-breaking high-velocity sell-off this past week took gold, silver, and Bitcoin below out trailing stops for each. The SPDR Gold Shares (GLD) busted its 10-dma, 20-dema, and prior breakout point just below 150 on Friday before finally finding support at the 50-dma. This may now put it in a lower-risk entry near the lows of the flag it formed in January and early February.
The iShares Silver Trust (SLV) was hit even harder, failing on its recent breakout attempt through the 17.20 level and then breaking below its 10-dma, 20-dema, and 50-dma during the latter part of the week.
Bitcoin, as represented by the chart of the Grayscale Bitcoin Trust (GBTC) lost about a quarter of its value over the past week. It triggered a final sell signal on the breach of the 200-dma on Monday. It is now plumbing the lows of its pattern where we will be watching for any potential undercut & rally set-ups that might appear, We believe that forced selling for the purpose of meeting margin calls resulted in a situation where investors needed to sell what they can and given the profitability of GLD, SLV, and GBTC over the past month they became ready sources of liquidity. We continue to believe that the Fed will be forced to act through the addition of more QE and/or lower interest rates, which has the potential to push these three vehicles higher.
