Breakout Forecast Selections for Week 33:
Market conditions continue with low breakout momentum and worsening negative momentum. The positive momentum gauge has continued to approve into the yellow at 37 up from a value of 32 at the end of the prior week. The medium momentum conditions signal a slight improvement in momentum selection reliability - be cautious.
The negative momentum gauge decreased from a value of 42 in the prior week to a medium value of 36 this week for negative momentum. The all time low for the positive momentum selection gauge is 8 during week 14 of 2018 and all time high is 120 during August 2017. Last published report: Week 32 Breakout Forecast
My momentum gauges are based on the count of the momentum stocks screened as either positive accelerating and negative accelerating stocks based on my research algorithm. The combination of the two different types of momentum categories screened by my algorithm may help validate the quality of the overall market momentum strength.
Total Return Chart: +81.42%
Market fund flow update August 10th from ETF.com:
The U.S. stock market challenged its all-time highs this week, prompting investors to add a cool $10.3 billion to ETFs. U.S. equity ETFs garnered net inflows of $8.5 billion, while international equity ETFs picked up $1.2 billion, according to the latest data from FactSet.
The data, which measure the week ending Thursday, Aug. 9, also showed a $749 million net inflow for U.S. fixed-income ETFs.
For 2018 as a whole, net inflows into U.S.-listed ETFs now total $155.6 billion. For context, inflows totaled $285.1 billion during the same period in 2017, a record year for flows that was juiced by the fiduciary rule and an ever-climbing stock market. ~ ETF.com
Last week two stocks gained more than 10% in five days: INVE +19.80% and SHSP +13.99%. This week I have selected 8 breakout stocks from the following sectors: 2 services, 3 healthcare, 1 consumer goods and 2 technology. SMRT +9.50% and PACB +4.02% were selected in advance for members and have already begun to make significant gains with the portfolio up +1.52% to start Week 33.
The new selections of positive momentum stocks for this week include:
- Pacific Biosciences of California (PACB) - Healthcare / Biotechnology
- Stein Mart (SMRT) - Services / Apparel Stores
Caution: These stocks are not necessarily recommended for long term buy/hold unless you are comfortable with very large price swings. As I continue to observe, strong momentum events usually last from one to three weeks and may encounter some substantial decline before returning again to positive gains.
Note: These are the most volatile selections I offer from among all the different Value & Momentum portfolios. Proposed entry points for each of the selected stocks are as close to the highlighted prices in yellow on the charts at market open. All stocks are selected for high short-term breakout results over one to three weeks.
Breakout Stock Selections for Week 33
Note: all breakout stocks are selected based on my algorithm to increase the frequency of 10% gains within a short period of time. Price targets are estimated through an unrelated technical charting process for those who are looking for estimated exit points, however it is possible the momentum in these selections may move well beyond the initial target.
Pick #1 : Pacific Biosciences of California (PACB) - Healthcare / Biotechnology Price Target: 5.50
|Aug-10-18 08:54AM||Pacific Biosciences' Sequel Sees Solid Q2, Competition Rife Zacks|
|Aug-06-18 08:20AM||Detailed Research: Economic Perspectives on Allete, Sterling Construction, Illumina, PROS, Altra Industrial Motion, and Pacific Biosciences of California What Drives Growth in Today's Competitive Landscape GlobeNewswire|
|Aug-03-18 09:58AM||Pacific Biosciences (PACB) Loss In Line With Estimates in Q2 Zacks|
|Aug-03-18 08:18AM||Pacific Biosciences of California Revenue Up Thanks to More System InstallsMotley Fool|
Pacific Biosciences of California, Inc. designs, develops, and manufactures sequencing systems to resolve genetically complex problems. The company's single molecule real-time (SMRT) sequencing technology enables single molecule real-time detection of biological processes.
Pick #2: Stein Mart (SMRT) - Services / Apparel Stores Price Target: 4.00
Stein Mart, Inc. a specialty off-price retailer, offers designer and name-brand fashion apparels, home decor merchandise, accessories, and shoes at everyday discount prices in the Unites States.
|Aug-01-18 07:30AM||Stein Mart Announces Second Quarter 2018 Earnings Release and Conference Call GlobeNewswire|
|Jul-16-18 07:20AM||Free Pre-Market Technical Pulse on Chico's FAS and Three More Apparel Stores Stocks ACCESSWIRE|
|Jun-19-18 03:15PM||Stein Mart, Inc. Announces Results of Annual Meeting of ShareholdersGlobeNewswire|
2018 Chart: +40.23% YTD
Cumulative return with 1-Week holding period.
A detailed holding period analysis for Q1 2018 sampled Breakout Stocks is available here for review: Value & Momentum Breakout Stock Returns For Q1 2018
Long Term Portfolio Returns
As a reminder of the other longer term portfolios being tracked and updated regularly with portfolio spreadsheets listed in the Tools section, here are the returns through Week 32.
Click the "Follow" button at the top of the page to enjoy free updates and select real-time alerts if you want timely updates on the latest stocks and portfolios I offer that are outperforming the S&P 500 in each of their respective time periods. Be sure to check out:
The Best Performing Portfolio Stocks from Week 31 from across all the portfolios (except the Premium Portfolio exclusive to members).
The Week 32 top performing stocks from across different Value & Momentum Portfolios will be released shortly and include NF Energy Saving Corporation (NFEC-OLD), Invitae Corporation (NVTA), Identive, Inc. (INVE), eXp World Holdings (EXPI), SharpSpring Inc. (SHSP) and others.
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I think these breakout stocks will serve you well in Week 33 and beyond. I hope you all do well with these stocks and always diversify to minimize some of the market risks. All the very best, and have a great week of trading!
JD Henning, PhD, MBA, CFE, CAMS
Disclosure: I am/we are long INVE, EXPI. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Editor's Note: This article covers one or more microcap stocks. Please be aware of the risks associated with these stocks.