The portfolio was down a horrific -4.44% this week. This officially confirms that we are in a bear market. Therefore, my trading strategy will change. Previously, I had been mostly buying pullbacks in strong stocks. This works well in a bull market, but you get your head handed to you in a bear market, as happened this week.
So I'll be switching to a different strategy. My trading activity is likely to be greatly reduced, which means that the previous format of this blog won't work too well. So I've been thinking about what to do on this blog. I've decided as an experiment to try something similar to Stock Insight, who follows a small number of stocks at a time. I'm probably going to be looking at only a few stocks now, and although my holding period is much longer than Stock Insight's, the format might work, although the posting would be less often.
I'm going to be looking mostly at stocks that are on IBD's Top 200 Composite Stocks list, which is published every Thursday. I like this list better than the IBD100. Not only are there more stocks, it's a more comprehensive list than the IBD100.
So, here's a look at each stock currently in the portfolio, plus a few on my watchlist:
FMD - The star of the portfolio. They increased guidance on Friday and the jumped up very close to a new high. If it breaks out, this thing could really move.
DECK - Not in the top 200 list, this was purchased on the pullback. It's holding up fairly well, but needs to start showing some strength.
EMCI - One of the few survivors of this week's purge. It's staying just above it's long term trendline.
UPL - New to the portfolio. Not in the Top 200, but if energy recovers, UPL will recover too as it is one of the highest rated energy stocks. It had a disturbingly bad day on Friday, it needs to hold its most recent low.
AP - Also new. It looked like it might have hit a low on Thursday, but Friday's action was very bad.
CBK - New. This stock has shown great strength over the past month. It had a big drop on Thursday, which looked like a good entry point.
FCBP - New. Banks have been one of the strongest sectors during this selloff, and it's one of the few sectors that I think I want to be in. On Friday it broke above its recent high of 59.32 and it looks headed for its 52 week high of 61.15.
On the watchlist:
ALJ - Energy stock that held up relatively well on Friday. I'm watching this closely for possible entry.
DXPE - IBD's top stock. I've been watching this for awhile now, but the downtrend continues and it looks less and less like it's going to give an entry point.
NTRI - a great stock, it held up very well in the market drop. The slight downtrend line and the rising 50 day moving average are forming a triangle that if it breaks to the upside might form a good entry point sometime next week.
SMDI - another stock that has held up well and the tightening action might form something worth looking at next week.
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