Market breadth turned up on Friday (11/2) giving a buy signal on the major indexes and since the vast majority of stocks move with the market direction, Friday’s buy signal cleared the way for stocks to move higher.
Conveniently for the start of the week, the time to initiate buys was the open of Monday. If we look back there were four stocks in my nifty-fifty stock list that gave individual buys for Monday’s open — SCHN, CECO, TBPH and RIO.
The idea was to buy on the open and sell on the close, a pure day trade on each stock. The value of this kind of trading allows the trader to leverage with margin and retain buying power leverage for each day.
Monday SCHN, from open to close, netted 1.8%, CECO lost 1.2%, TBPH gained 1.7%, and RIO gained .4% for a net of .47%, exclusive of slippage and commission for the basket. While that was not a great gain (leveraged it would have been at least twice as much), it was a profit, and it should be noted that was the first day of the turn to the upside for the market.
And as Monday’s market rally got moving, it generated 13 individual stock buy signals in the nifty-fifty stock list. Again it was buy on Tuesday’s open (today’s open) and sell on today’s close.
The results for today’s 13 day trades in stocks — FCX up 1.1%, ACM up 2.8%, NVDA up 1.2%, BBL up 1.5%, TPC up 3.9%, DGI down 1%, NAV up .8%, BHP up 2.2%, IRBT up 1%, FPRX down .01%, ADSK up 7% (highlighted on the chart below), ACAS up .4%, and TWI up .2%. An un-leveraged net across the basket of 1.6%.
Stocks from my list giving buy signals for tomorrow’s open are HIIQ, MSCC, GPS, IGT, UAL, and BRKS. So we’ll see how those go. (These are presented here for entertainment only and are not be construed as market advice.)
(right click on the chart for a larger view)