One New CANSLIM Long Position, One New Speculative CANSLIM Long Position, And Two Stocks I Am Adding To My Existing Long Positions For Monday’s Stock Market Session

February 2, 2008

All of these longs are actually quite nice and all have one thing in common. They are all from very strong sectors that have been moving up the charts of the IBD 197 industry groups. There is not one stock that I saw in my scans with a pretty chart that came from anything but a bear market sector. And as I will remind you (for those that think we have a bottom in the market) bear market rallies are easily spotted by the quality of longs that appear in the scans as we move along. The simple fact that the sectors that do very well in bear markets are the sectors that are making the most impressive gains on this rally. That is your clearest of clear tells that this is not a fresh start to a brand new rally that is going to launch the stocks that go on to become histories biggest winners. No, this is simply a bear market rally that is going to suck in the retail crowd that believes stocks like GOOG AAPL RIMM and BIDU are finally cheap enough to buy. These are the stocks I will short when this rally is done. And while we wait for that to happen to those stocks, we have some leading stocks that do not have any resistance to deal with right now. There is one chart below that I like a lot and those familiar with me know which one that is. But it still is not perfect, by any means and therefore there is no reason to get nuts. The general trend of the stock market is not nice enough to do that.

new CANSLIM long position: CHTT

CHTT is breaking out to a new all-time high from an ascending base pattern, on very 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 position: SPW

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

adding to existing speculative CANSLIM long position: LSR

LSR is bouncing off the 50 day moving average and is closing at its HOD, on strong volume. Use limit orders only. Cut your loss with a close below the 50 day moving average, if the stock does not move higher immediately.

adding to existing speculative long position: ILMN

ILMN is bouncing off support very close to 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.