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Weekly Watchlist



August 07, 2013 – Comments (0) | RELATED TICKERS: EPL.DL , GMCR.DL , ROSE.DL

Oil and gas production and exploration companies continue to dominate my favorite sector list.  It appears that the sector is bottoming and is due for a run.  It will still take another week or two to confirm this but I feel like it's worth the risk at this point.  The construction and engineering sector chart is also intriguing.  There's some pretty obvious resistance around the 650 mark but the increasing lows indicate that it's not in a true sideways pattern.  I feel like there's some pent up buying action that hasn't come to fruition yet.  It's certainly far from a guarantee but I feel it's worth a play.  Lastly, the specialty services sector appears to have established a floor after falling off a cliff almost 3 months ago. Floors are our friends because the stability may entice the big institutions to throw money their way.

My stock picks will be tougher to write this week as I was out of town over the weekend and will have to write while essentially ignoring the last 2 days of market activity.  I'll probably comment on it, but note that I'm referrring to what the stock chart looked like over the weekend, not today.

EPL Oil & Gas (EPL) - This one continues to be a darling.  It's a little tougher to love at this price but the lack of a meaningful PEG ratio on this stock introduces the element of gamble.  At heart, I'm a gambler.  I'm not able to do it with my retirement money, but when a stock like EPL comes along and shows you that it's not that stupid of a risk, it's tough to turn it down.  All 3 of my buying indicators are still positive but I do anticipate this stock moving sideways most of the week as there will be pressure to move back toward its 30 day SMA.   Despite this risk I'm going to hang my hat on it this week as I feel this is just too much upside potential to stay away.

Green Mountain Coffee Roasters (GMCR) - This chart couldn't be more enticing right now.  A sideways trend for nearly 3 months and it finally breaks above its 30 day SMA with some volume support?!?  Sign me up!  And by "some volume support" I mean a nearly 50% increase over its 10 day volume average.  That's nothing to scoff at.  With both the stochastic and MACD histogram in the buy realm I'm really liking this pick.  Further, GMCR is a stock that is heavily traded enough that it's going to move more on momentum than actual valuation.  Granted, I don't think that it's a terrible value with its PEG ratio sitting at 1.44 (as of this writing) but it's certainly not an unavoidable steal at this price.

Rosetta Resources (ROSE) - This one also potential written all over it.  The last 3 months have been decidedly sideways but volatile to boot, which presents grand opportunity.  In ROSE we have a stock who recently crossed its 30 day SMA with substantial volume support, a nice buy signal on the stochastic, and a fresh buy signal from the MACD histogram.  Combine all of these factors with a PEG ratio of .53 (as of this writing) and it looks like ROSE could do some serious flying soon.  I'm a huge fan of ROSE at its $47.88 closing price on Friday.

I'm also quite interested in MTZ, OUTR, and CBI this week but they're simply lacking my 3 required buy signals.  MTZ did throw one on Monday but I have to make my picks as of Friday.  Regardless, I like the opportunity here this week.  Happy picking! 

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