6/8 Top Prospects

I think this counts as a bearish capitulation day.

Twenty-one breakouts beyond the 55-day price channel among the 300+ stocks and exchange trade funds I screened. Five of them have strong trends.

One of the bear breakouts is SPY -- the S&P 500 exchange-traded fund.

Strong-trend Breakouts

sym	phase	adx	bday	blevel	stop	atr	atr%
ABX*		30	jun8	$44.25	$45.34	1.09	2.5%
ADSK*		26	jun8	$39.39	$40.42	1.03	2.6%
CAT		30	jun8	$99.15	$101.62	2.47	2.5%
HIG*		27	jun7	$24.83	$25.38	0.55	2.2%
XLI+*		26	jun8	$35.77	$36.32	0.55	1.5%

Exchange-traded funds are marked with a plus sign (+) after the ticker symbol. My holdings are marked with an asterisk (*).

All four of the strong-trend stocks have bullish financials.

Weak-trend Breakouts

sym	phase	adx	bday	blevel	stop	atr	atr%
CHII+		22	jun8	$15.13	$15.19	0.21	1.4%
CHIX+		19	jun8	$13.22	$13.37	0.15	1.1%
CIEN		18	jun8	$22.20	$22.71	1.10	5.0%
DHI		14	jun8	$11.09	$11.40	0.32	2.9%
HON		21	jun8	$56.30	$57.41	1.11	2.0%
IWM+		17	jun8	$79.49	$80.83	1.34	1.7%
JDSU		18	jun8	$17.83	$18.53	0.70	3.9%
MTG		20	jun8	$7.21	$7.53	0.34	4.7%
PCX		17	jun8	$21.04	$21.96	0.92	4.4%
PRU		21	jun8	$59.28	$60.31	1.43	2.4%
SNDK		12	jun8	$42.83	$44.03	1.20	2.8%
SPY		19	jun8	$128.32	$129.73	1.47	1.2%
THD+		23	jun8	$63.80	$64.30	1.04	1.6%
TXN		22	jun8	$33.11	$33.72	0.61	1.8%
WDC		21	jun8	$33.91	$34.75	0.84	2.5%
XLK+		22	jun8	$25.11	$25.40	0.29	1.1%

Exchange-traded funds are marked with a plus sign (+) after the ticker symbol. My holdings are marked with an asterisk (*).

CHII -- the China industrials exchange-traded fund -- and CHIX -- the China financials fund -- both trade on very low volume.

CIEN’s breakout was on a huge downward gap after earnings.

CREE broke out to the bearside, but with a declining average direction index, which negates the phase change.



Key

• phase: Green for a bull-phase breakout, red for a bear phase.
• adx: Average direction index location, indicating the strength, or the temperature, of the trend. Orange for 40 or greater, aqua (light blue) for 25 and up but below 40, magenta (light purple) for 20 and up but below 25, and brown for anything below 20. (Mnemonic: Orange for the overhead sun, blue for the surrounding sky, magenta for sunset on the horizon and brown for the earth.)
• bday: Breakout day, the day the price broke through the upper or lower 55-day price line.
• blevel: Breakout level, the price level of the line that was broken through.
• bstop: The stop/loss price calculated on breakout days as the 14-day average true range below the breakout-day low for a bull phase and above thre breakout-day high for a bear phase.
• atr: The 14-day average true range, in the same currency as the price.
• atr%: The average true range as a percentage of the breakout level, an indicator of volatility that is comparable for all potential trades.

About channel analysis

Read a detailed explanation of my channel analysis method, including trading rules.