EGG Scan for June 20th

Markets sold lower to start the day, but once again managed to push back into positive territory. Why the jitters? Nothing big just more of the same and the same outcome. Jobless claims in line at 312k, leading indicators up 0.5%, (unfortunately in line and not near what everyone is projecting for economic growth. Again all we can do is take what the market gives one day at a time. Not in the business speculating only managing the process of risk.

Gold and Silver offered some moves of interest today as fear stirs the pot in the inflation arena. Oil prices, weaker dollar and higher Treasury bond yields all contributed to the move and worth our attention going forward.

You can see in the scans the last week the rotation is not leading to leadership as much as more breadth in the move higher. That is good overall and it will eventually result in specific leadership as well. We just have to be patient.

Running the EGG Scans – First the daily winners…

  • Today’s leaders – NUGT/GDX/GDXJ – (Gold Miners) gold jumps 3.5% and the miners 16%, USLV/SIL (Silver) up 13.8%,  TBT (Short Treasury bonds) up on yields rising, EWJ (Japan) nice follow through on continuation breakout, and EPU (Peru) breakout from consolidation,
  • Wednesday’s leaders – RUSL (Russia) bounced back 7.5%, NUGT (Gold Miners) jumped 7.6%, SVXY (volatility disappears again), EDC (Emerging Markets) Nice bounce, GREK (Greece) nice bounce off test in move higher. Honorable mention XLU (Utilities) nice bounce through resistance.
  • Tuesday”s leaders – TAN (Solar), PBW (Clean Energy), SVXY (short VIX), TNA (Small Caps) and FAS (Financials). Honorable mention KRE (Regional Banks) & KRE (Banks).
  • Monday’s leaders – UPW (Utilities), XBI (biotech), IHI (Medical Devices), TAN (Solar) and DIG (Energy). IHI benefited from the acquisition in the sector. TAN is EGG today.
  • Friday’s leaders – YINN (China), ERX (Energy), TAN (Solar), SOCL (Social Media), USLV (Silver) and RUSL (Russia).
  • Thursday’s leaders – UCO (Crude Oil), SIL (Silver miners), GDXJ (junior gold miners), TAN (solar power) UGAZ (natural gas), and DBE (energy).
  • Wednesday’s Leaders – RUSL (down 4%), SOCL (down 0.7%), PALL (down 4.5%), FCG (up 1.4%), JMF (down 1.3%) I stated they gave a different look, and that look didn’t last for more than one day.

Looking at the last week plus of scans above we have to look for common ground and the sectors with the best upside or downside momentum. Energy, Alternative Energy, Precious Metals, Utilities, and Short VIX are the leaders. Today the precious metals exerted new leadership with the worries in Iraq sparking the move along with the weaker dollar and higher interest rates.

EGG Model Watch List:

EGG Tracking… Stock recommendation follow up.

  1. BRCM – giving the best look relative to the semiconductors leadership. $31.15 entry last week was optimal looking back. Thus, a test of that level and hold, or a move through $31.50 on volume would be of interest for a EGG trade on individual stock level. Got the early move last Thursday (entry $31.50) and it followed through on Friday. News pushed the stock up 12% last week. Sold half at $35 and $34 stop on the balance. See how this plays out… the news wasn’t that earth shattering and willing to take my gift of gains. Nice bounce back towards the highs the balance of the week. Raise stop to $37 on balance of shares. Topping and volume falling back to normal tighter stops and watching.

Current EGG:

TAN is the Egg Model at $42.30. Solid move higher on Tuesday and followed by some testing today. The interest in the sector invited money into the sector short term. The intraday bounce off support near the $43.70 mark was of interest going into tomorrow. Held our positions and watching to see if we need to lessen our exposure tomorrow. Oil prices did bounce back above the $106 range and Iraq is still a big question mark looking forward.  We have adjusted the stop and watching to see how it follows through tomorrow.