Considering market conditions, Trending 123 and the stock scan has picked the best performing sectors for it's subscribers. Those sectors have been energy, XAU, the SMH and SPY. We have had some good rotation identification.
Oil Services Holders ETF (OIH) - Daily Chart
The daily chart of the OIH illustrates that it broke out of an ascending triangle in late November 2005 and has rallied higher ever since. The OIH has been parabolic up and that is not a pattern, you can't trade that. The OIH is up 17%. However, sometimes you get the best gains when indicators and oscillators are overbought. Indicators and oscillators are bullish, and stochastics are bull flagging, and volume has been strong. The PPO is making new highs along with price. Our energy stocks are doing well, and I have not issued any sell alerts yet. We currently have 6 energy stocks in the portfolio. Collectively we are up 90 points on these stocks. We will soon be rotating out of this sector. The reason for this rotation will due to the stocks front running the price in oil and consequently have big prices gains. I want to get out these before the price of Oil double tops or makes a new high. A new high will be the signal to sell the news and exit. We will rotate into utilities, drugs, and to a lesser extent metal stocks.
The Gold Bugs Index - Amex (HUI)- Daily Chart
The daily chart of the HUI illustrates that it is currently forming a bullish pennant (On the weekly, the HUI is breaking out of a slim jim pattern and is doing what it is supposed to.) As you can see, the Aroon is in a bullish trend. The PPO continues to make new highs along with price as is the RSI. Finally, the stochastics are bull flagging. Stick with the leaders and the front runners, such as NEM, GG, ABX, and GLG, you will be fine. There are no hints that a correction is about to start. Dump your precious metal laggards now and get into large caps. Again, the trend is bullish and the PPO continues to make new highs along with multi year/decade highs in price. Buy the dips.
OIH DAILY
OIH WEEKLY
$HUI DAILY
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