Here's my second installment of my weekly watchlist search. There's quite a bit of carryover this week.
The 3 month chart for biotech stocks is beginning to indicate that an uptrend may have resumed but we would still be on the leading edge of it so I'm not shying away at this point. Again, I look for sideways moving or bottoming sector charts so that I catch as much upside as possible. A sector that is already uptrending makes me believe that I've missed more of the runup than I am comfortable with and that there may be better opportunities out there. Further, there weren't any stocks in this segment that met all of my buy criteria, so I didn't add any to the watchlist this week.
The chart for oil and gas production and exploration companies is still looking like a pretty nice bottom over the last 3 months.
Asset management and custody banks have moved into a nice sideways trend after 9 solid months of uptrend. Ideally this would simply be idling before a move higher so I like some of the opportunities here. Same story here as with the biotechs. While I feel that there is opportunity in the sector, I felt like all of the purchase worthy stocks were too pricey for me so I didn't add any to the watchlist.
Lastly, the construction, farm machinery, and heavy truck sector is showing a potential sideways movement even though the 3 month chart is a little muddy. There are some hints of downward pressure creeping in around the edges so I'll keep a lid on my expectations for stocks in this group.
EPL Oil & Gas, Inc (EPL) - This one carries over from last week but has an improved story. It did break it's 30 day SMA last week with what I thought was no clear support line. I thought that because I'm dumb and still fairly new in my habit of reviewing charts. A further examination shows me that it does indeed have support around the $30.08 range and the stock was quick to get back above that level with decent volume behind it. I still don't have a great idea of just how far this may run if it continues its upward momentum but I'm move optimistic on both the likelihood of continued upticks along with how high it could go. I'll be initiating a positive CAPS pick if I see a sideways move on Monday or a small increase in price. A big increase in price would make me think I missed the boat again.
Rosetta Resources, Inc (ROSE) - I'm no longer worried about a downtrend as it held it's support around the $45.08 range and moved back up this week but I am worried by the strong sessions it has had over the last 2 days. I'd be much more interested should this move sideways for 2-3 days or have 2-3 small losing sessions with average or lower volume. I'm not willing to hang my hat on this one yet so I'll be excluding it from next weeks performance results as I wouldn't put my own money into it right now.
Wabash National Corporation (WNC) - This one is my darling of the week. I was afraid that I had missed all of the profit when it surged early last week but it was polite enough to come back down to it's 30 day SMA and give me a second chance. I'll be opening a CAPS pick on sideways or positive movement from this on Monday. It still has a tasty PEG ratio of .45 (seeing as how it's the exact same price as last week) so I feel like there's a lot of room for price increase.
I'll be judging this coming week's performance on EPL and WNC but I will be keeping a close eye on ROSE to see what the following week might have in store. Happy profit hunting!