The VoSI Focus List is a compilation and reference list of stocks for which Pocket Pivot or Buyable Gap-Up Reports have been issued. 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 S&P 500 Index broke out to all-time highs on Friday, along with the Dow Jones Industrials Index, which had already posted a new all-time the day before. Meanwhile, the NASDAQ Composite Index posted a trendline breakout on Thursday and continued higher on Friday as it meets up with its prior June highs. The index appears poised for a breakout to all-time highs, and many leading stocks are confirming this currently. Note how the NASDAQ Composite shook sellers out with two ugly sell-offs that would have likely scared out the bravest of investors, but our Ugly Duckling long entry methods, such as the Undercut & Rally (U&R) and the Moving Average Undercut & Rally (MAU&R), would have enabled investors to move back in once the market and leading stocks had stabilized.
As long as the new-high breakouts in the S&P 500 and Dow as well as the recent trendline breakout in the NASDAQ Composite hold up, the market trend remains strongly to the upside. The Market Direction Model (MDM) is currently on a buy signal, while the VIX Volatility Model (VVM) is currently on a cash/neutral signal.
Removed from the List this Week: Zillow (Z). The stock is acting erratically as it breaks down on volume and then slashes back up through its 50-dma. This needs to settle down before we would re-consider it for inclusion on the Focus List
Focus List Expected to Report Earnings This Week: Netflix (NFLX) on Monday after the close, Note that the stock posted a roundabout pocket pivot on Wednesday as it regained its 50-dma. It has since moved higher, but buying the stock so close to earnings may necessitate having to play "earnings roulette," which is generally something that we do not advise.
Applied Optoelectronics (AAOI) broke out on Thursday, but had already issued a five-day pocket pivot six days prior as it came up through the 50-dma on heavy buying volume on a five-day pocket. That alone was sufficient to call the stock a buy at that point based on the "Moving Average Undercut & Rally" or MAU&R long set-up.
Appian (AAPN) is currently extended from Wednesday's trendline breakout, but pullbacks closer to the breakout point in the 19.00-19.50 price area might offer lower-risk entries from here.
Lumentum Holdings (LITE) posted a strong-volume pocket pivot on Thursday and held tight on Friday as volume dried up significantly. Pullbacks closer to the 20-dema would be preferable as potential entries, but the stock was already buyable per our morning Focus List Notes when it was sitting along the 20-dema earlier in the week.
ServiceNow (NOW) found volume support at the 10-dma on Friday. Pullbacks to the 10-dma remain your lower-risk entry opportunities.
Yext (YEXT) posted two pocket pivots in a row on Wednesday and Thursday. The first one came off the 10-dma while the second occured off the 50-dma. The stock is slightly extended, but any small pullbacks closer to the 50-dma would offer lower-risk entries from here.
Yandex (YNDX) was added to the Focus List on Friday after posting a buyable gap-up move on Thursday. That BGU is actionable here using the 30.90 intraday low as a tight selling guide.