The past month saw a couple more changes to our CANSLIM top-8 as ranked by Market Cap. F5 Networks (NASDAQ:FFIV) was dropped (falling to 10th position) and taking its place was Agrium (AGU). The top-8 in order are Apple (NASDAQ:AAPL), Vale S.A. (NYSE:VALE), Barrick Gold (ABX), Baidu (NASDAQ:BIDU), Research in Motion (RIMM), Cognizant Technlogy (NASDAQ:CTSH), Netflix (NASDAQ:NFLX), and Agrium (AGU). The Screener setup was as follows:
Apple (AAPL) has been dogged in its defense of $330 support. What had looked a bearish head-and-shoulder pattern has evolved into a more neutral consolidation. But $330 support is a battleline. Note the fast arriving 200-day MA, currently at $320, to help offer support if needed.
Vale S.A. (VALE) delivered on its bearish head-and-shoulder pattern. It sliced $31 relatively easily, then struggled in a rally to break above this price. The past couple of days have produced a "Death Cross" between its 50-day and 200-day MA, a sign a longer term downtrend is now in play. The fundamentals keep it in the screen, but price action is weak.
Barrick Gold (ABX) collapsed from a high of $55.74 on April 21st to a low of $45.01 on May 13th, cutting through both 50-day and 200-day MAs with relative ease. The May low marked a new reaction low for the year, undercutting the $46 bottom from January. A new lower higher (on this rally) will kick start a new downward trend for the stock. The past week has seen a modest rally, but the stock has it all to do to mount a comeback. First up is the 200-day MA sitting overhead at $49.07.
Baidu (BIDU) is one of the rally stalwarts in recent months, but it too has its struggles. The stock lost support of its 50-day MA on May 13th and was rebuffed at this moving average following a rally on May 20th. A similar event played out in December 2010 and the stock was able to recover. Two levels of support are key here: $130 in the short term with a second, stronger tier, around $120.
When the overall market floundered, Research in Motion (RIMM) was already in the mire. The past few weeks haven't changed anything. The stock is down at September 2010 lows ($42.84) and is well away from its 200-day MA at $52.97. Back in February 2011 the stock traded at high of $70.54.
Cognizant Technology (CTSH) is another high flyer for the past year. Early May saw the stock gap below its 50-day MA and then drift lower. It's currently trading just above its 200-day MA at $70.83. The sizable gap breakdown (on volume) will be a point of supply on the next advance, but value buyers may be tempted to take a look here.
Netflix (NFLX) has the best looking chart of the eight stocks. The stock is currently pressuring $250 resistance. Any existing shorts will be squeezed by buyers on the advancing 50-day MA (at $235.20). It's a relatively straightforward risk:reward play; buyers will take a heavier volume (at least double a 2-month average of volume) close above $250, stop on a loss of $225.
Finally, Agrium (AGU) sneaks in at eighth spot. The chart isn't looking too great. The stock lost support of its 200-day MA in early May and hasn't made any serious attempt to regain it. There is an area of support around $78, but beyond that there isn't a whole lot until you get to $50. Not a stock you would want to bet the house on.