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VoSI Focus List Review for the Week Ended July 3, 2020

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: 
While the NASDAQ Composite and NASDAQ 100 Indexes forge all-time highs, the rest of the market, including the S&P 500Dow, Russell 2000, and NYSE Composite Indexes, has been in a three-week correction/consolidation. The Dow, Russell 2000 and NYSE Composite all remain below their 200-day moving averages.

Once can compare the action between all the major market indexes on the group chart, below. Note that the Dow, NYSE Composite, and Russell 2000 also posted island tops in early June and have since declined from those peak levels. The divergence may be a temporary cautionary sign or it may signal trouble ahead, but in any case members should simply review their selling guides if it turns out to be indicative of something more serious.

The Market Direction Model (MDM) remains on a BUY signal.

Notable Action: 
Few names on the Focus List are making substantial upside progress. Most were in fact buyable on Monday down near deep support. One example is Netflix (NFLX) which failed on a breakout attempt the prior week and hen successfully tested and bounced off its 50-dma on Monday. That led to a second base breakout on Wednesday on much higher volume than that seen on the prior breakouts. Notice, however, that Wednesday's strength did not result in any follow-through to the upside as NFLX reversed off its intraday highs to close in the red. This underscores our view that the best approach in this market is to maintain an opportunistic bias looking to buy on constructive weakness rather than chasing strength.

Atlassian (TEAM) was reported on two weeks ago wen it posted a pocket pivot on big volume. Again, note how the strength on big volume does not lead to further upside, and the stock simply comes back down to test its 50-dma on Monday. It then rebounds back to the highs of its six-week base and posts an all-time closing high without breaking out to an absolute all-time high.

Tesla (TSLA) is another example of using weakness to gain an opportunistic and optimal entry. On Monday it shook out just below its 20-dema and then bounced back to the upside, closing back above the $1,000 Century Mark. That would have triggered an entry at the $1,000 level and allowed one to ride the 20% move higher over the next three days. TSLA gapped higher on Thursday but is now quite extended from the last proper buy point near the $1,000 level.

Precious metals continue to hold up near their recent highs, but Bitcoin is running into resistance along its 200-dma, as the daily chart of the Grayscale Bitcoin Trust (GBTC) shows. A week ago it broke below the 200-dma and a brief rally
on Tuesday and Wednesday ran into resistance at the 200-dma. GBTC then reversed to close at a lower closing low on Thursday. This may head lower so if you are long GBTC, know where your selling guides are. We have considered the 200-dma to be critical near-term support, thus a violation of the line is a technical sell signal.

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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