It was another solid week for the bulls, but volume was one again lower.
After the nasty end-of-October sell off, most stocks have recovered their losses and moved back to just under their recent highs. SPY and APPL are 2 good examples. The Dow Utilities, Dow Transports, SP-500 and all 3 Russell Indices show similar patterns.
The only standout among the indices is the Dow Industrials which moved out to a new high for the year on Thursday.
In terms of the big picture, Investors Business Daily moved back to "Market in Confirmed Uptrend."
The market is showing a distinct ability to move higher in the face of bad news. Last Friday's unemployment report was awful, and this Friday's consumer confidence hit a 3 month low. But stocks rose anyway and are now up 9 of the last 10 days, but on lower volume.
In term of trading, I picked up 100 shares of Cerner (CERN) in each account on Monday. I've been watching this stock make new highs for much of the year and got shaken out earlier this year on both a stock and option trade. After making a new high at about $85, we got a nice orderly pullback to the $76 area. I got in at about $78.50 and it moved higher from there, closing the week at $80.14.
From the weekend perspective, I have to watch this one carefully. IBD indicates "Medical IT forms's sales fell for the first time in many quarters." The chart shows distribution (selling on higher volume) on Tuesday and Thursday of this past week after a strong Monday. The weekly chart shows distribution as well.
My other stock trade this week was taking profits in ABVT. After entering this position at $58 even back on 9/23/2009, I was able to take a $550 profit in each account which was just too good to pass up. Of course, the stock meandered around and closed higher for the week and closed at $54.21. I'm trying not to chase this stock and waiting for a pull back before re-entering. On the technical side, IBD indicates "Just above 63.64 buy point after rebound from 10-wk line." That's clearly a typo and they meant 53.64. Either way, i'm now on the wrong side of this trade and will be waiting for a pullback to re-enter.
In terms of stocks with squares around them (in good technical and fundamenal buying positions) they are AAPL and HMIN. I'm already long on AAPL and reluctant to buy Chinese stocks.
The only other portfolio action this past week was purchase of LEHMAN BROS FSB WILMINGTON DEL C/D FDIC INS TO LIMITS 5.30% 05/17/2010 in my taxable account.
See you on the positions update.