Weekend Review and Update

Portfolio Allocation

Trade Anatomy Performance

+4.26% MTD |  +31.75% YTD

Portfolio Summary

7 long | 1 buy | 1 sell 

Watchlist Summary

23 candidates

 

Portfolio Summary

The week was rather quiet with new buys and sells.  We had one sell and one buy for the Trade Anatomy portfolio.  We ended the week 42% invested with the rest in cash.  Quality trades are still coming forward, but not at a heavy rate.   This week's performance can be attributed to three stocks EFOI, LGIH, and LXFT.  We sold XON on 8/11/15 for a -2.56% loss.  XON appeared to have all the makings of a strong trending stock, but quickly took a downward turn this week.  We had entered the trade on 7/15/15 at 53.61, and XON appreciated to almost 70 a share.  We were looking at a 30% gain, but within four days XON gave it all back and then some.  Gains weren't realized because the trade was still too new and the magnitude of the move down pushed the stock under my trailing stop line on 8/11/15.  The trade had only been active for about three weeks which is a very short period of time when you're trying to ride trends for 10+ weeks or more.  Below is the chart.

We did enter one new trade this week which was ABTL at 18.48.  We're using 16.83 as our initial stop and risking .50% of our account value.  5.06% of our account value was allocated towards this trade.

As we mentioned previously, this week's performance hinged on the price moves from three stocks. EFOI was hands down the biggest contributor and easily gets the credit for the majority of the positive performance. Since our entry on 8/5/15, EFOI is now up 70%.  On Friday, the stock moved an additional 38%.  As we noted last week, the stock was bought when it was already up 18% for the week.  LXFT which we've been long since February, moved to a new closing high for the year after reporting earnings on Thursday.  LGIH has performed well with a 30% gain since it's breakout last week.  After it's initial move up starting on the 7/15, ASC has since struggled to hold the 13-14 range.  Over the course of last week, ASC even tripped the longer blue trending line.  We did get an a bounce back above, but if it happens again, the position will be sold.  Below are our remaining open positions.

Watchlist Summary

The watchlist has stayed fairly consistent, ranging from 15-25 names, for most of the year.  When markets aren't producing supportive trends up or down, stock selection becomes even more important.  It's necessary to find stocks that will trend not just when indexes are moving higher.  To help find these types of stocks, I will generally screen for a percentage of the 52wk high.  This is extremely common among traders who like to buy stocks breaking out to new highs.   Although this helps, it's not the end of the process, but just the beginning.  I'm not looking for just any stock making new highs. I'm looking for stocks making new highs, but coming off of big weekly chart patterns with fundamental support.  This week I've included several weekly charts from the current watchlist. If you click the first chart, an enlarged lightbox will appear, and you can then view all the charts.

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