Two New CANSLIM Long Positions, Two New Speculative CANSLIM Long Positions, And Two New Speculative Positions For Friday’s Stock Market Session

January 31, 2008

Today was indeed a follow-through day but everyone you must realize that this happened no less than five times (could be more but a quick glance shows five) during the bear market from 2000-2002. When the GDP, stock market, and Fed interest rates are all falling, the stock market is in a bear market. Period. However, you will always get rallies that last a little while that do help bull stocks in bear markets do well. If you look at the volume today on the follow-through and compare it to the volume on the selling earlier this month you can see that it isn’t necessarily encouraging and hinting at a “for sure” bottom. So all of these longs are going to be small due to the prevailing trend and lack of perfect charts in this group. I would buy a LOT more of INFA if it would have closed up anywhere from 5% to 10% but instead the 12% gain makes it a bit risky to load up here. Therefore, I will be waiting for a low volume pullback before putting too much capital to work in this diamond in a mine of rough charts. GILT, TNS, and APOL are all HOT and very pretty charts but they are not perfect and the big trend is still very much down in this market so I must suggest, one more time, caution with these longs. I would prefer it if newbies stay away from XTLB and CLHB as the fundamentals do not make them safe enough for you guys. Remember, folks, I am still around 50% cash and I plan on staying that way until a few more CANSLIM quality longs show up (if you don’t know what CANSLIM entails, get your butt over to investors.com).

ANALYSIS BEFORE 6AM EST.

new CANSLIM long positions: INFA APOL TNS GILT

INFA is breaking out of a two-year cup with high handle base and a one month cup base, on extremely strong volume. Cut your loss with a close below the 50 day moving average, if the stock does not move higher immediately.

APOL is bouncing off of the 50 day moving average, on very strong volume. Cut your loss with a close below the 72.04 level, if the stock does not move higher immediately.

TNS is breaking out above the 50 day moving average, on strong volume. Cut your loss with a close below the 15.95 level, if the stock does not move higher immediately.

GILT is breaking out to a new 2008 high, after bouncing off of support, on strong volume. Cut your loss with a close below the 50 day moving average, if the stock does not move higher immediately.

new speculative CANSLIM long positions: XTLB CLHB

XTLB is breaking out to a new 2008 high, from a short round and flat base, on very strong volume. Cut your loss with a close below the 50 day moving average, if the stock does not move higher immediately.

CLHB is breaking out to a new all-time high and bouncing off the 50 day moving average, on strong volume. Cut your loss with a close below the 50 day moving average, if the stock does not move higher immediately.