Current Report Watch List
The VoSI Report Watch List is a compilation and reference list of stocks for which Pocket Pivot or Buyable Gap-Up Reports have been issued and which are still active. 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 List can be purchased. The following notes are intended to assist in this process. Please note that members can enlarge the 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.
The major market indexes remain in a three-week downtrend from their early May highs. This is the deepest correction since the market rally began in late December. The NASDAQ Composite Index stalled on Friday after an opening gap-up move to close near its intraday lows. Volume was light ahead of the long three-day Memorial Day Holiday weekend. A test of the 200-dma for the NASDAQ in the coming days looks likely. We would remain cautious and ready to sell any remaining long positions if they break near-term support and trailing stops. In most cases, this would be the 20-dema.
The Market Direction Model (MDM) remains on a cash signal.
Removed from the List this Week: None.
Watch List Stocks Expected to Report Earnings this Week: Heico (HEI) on Wednesday before the open, ZScaler (ZS) on Thursday after the close. Lululemon (LULU) is scheduled to report on Thursday according to the NASDAQ website, but the date is currently unconfirmed.
Names still remaining on the Report Watch List continue to hold up with the exception of Chipotle Mexican Grill (CMG). The stock broke down sharply on Thursday as it gapped through its 50-dma on heavy selling volume after an analyst downgraded the stock. The stock has rallied over 20% since we first reported on it as a buyable gap-up back in February of this year. A high-volume gap-down move like Thursday's is often enough of a reason to sell a stock after a prolonged uptrend. We would also be alert to any rallies back up towards the 50-dma from here as potential selling opportunities, or even as short-selling opportunities.
Advanced Micro Devices (AMD) is also starting to break down. The stock dropped below its 50-dma on Thursday as volume picked up sharply from the prior day. It is now testing the prior May lows as it sits on the verge of a 50-dma technical violation. AMD can also be viewed as a potential short-sale target here on any rallies up into the 50-dma.
As we've expected per our previous weekend reports, the situation with respect to individual leading stocks and the general market continues to deteriorate. Raising cash as one is stopped out of long positions and staying there is likely the most prudent course of action until the market stabilizes. At this stage, we would not be surprised to see the market correct further given the extent of the market's run since late December.