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We look at hundreds of charts every week, and we’ve seen worse environments than this—while high-growth stocks have taken a beating, much of the broad market is at least hanging in there. But the fact is that as long as the intermediate-term trend of the major indexes is pointed down, it’s going to be tough to make much money; the last couple of trading days has reinforced that fact. Thus, while a little buying here or there is fine, especially in resilient groups, less is generally more in this environment—preserving most of your capital and building your watch list are what will pay off down the road.

The good news is that, as earnings season progresses, we’re able to see which stocks have “it,” and which ones are being tossed out by big fund managers. This week’s list has a few recent earnings winners, including our Top Pick, Harley-Davidson (HOG), which just blasted out of a 14-week base on a great quarterly report.

Stock Name	Price	Buy Range	Loss Limit
WABCO Holdings (WBC)	0.00	104-107	97-98
Skyworks Solutions (SWKS)	0.00	39-41	35-36
SunEdison (SUNE)	0.00	18-19	15.5-16
SunPower (SPWR)	12.26	34-35	29-30
Salix Pharmaceuticals (SLXP)	0.00	102-106	98-100
Matador Resources Company (MTDR)	27.89	26-27	24-24.5
Harley-Davidson Inc. (HOG)	0.00	70-72	66-67
Delta Air Lines (DAL)	54.28	35-36.5	33-34
Comstock Resources (CRK)	0.00	25-27	22-23
Cabot Oil & Gas (COG)	0.00	36.5-38	35-35.5

Current Market Outlook


You shouldn’t read too much into last week’s action; volume was super-light as most investors were on the beach. We’ll get a clearer read on things this week and next as institutional investors return to their trading desks. Still, taking a step back, the market’s rally from early August is intact, and we’ve seen a continued, gradual improvement among leading stocks, with a few popping higher each week and, importantly, with many moving higher after their initial breakouts. Right now, we’ll keep our Market Monitor where it stands—we continue to lean bullish, but we’re not yet willing to pound the table—but we like the persistently positive action of the past month.

This week’s list features another strong group of stocks that have seen heavy-volume buying of late, a sign big investors are getting in. Our Top Pick is Avago Technologies (AVGO), a chipmaker with a couple of major catalysts that should propel earnings much higher in the quarters ahead.

Stock Name	Price	Buy Range	Loss Limit
Twitter (TWTR)	40.37	47-50	42-43
Skyworks Solutions (SWKS)	0.00	54-56	49-50
Seagate Technology (STX)	0.00	60-62.5	58-59
Petrobras (PBR)	14.78	18-19	16-17
Madison Square Garden (MSG)	298.38	64.5-66	60-61
Macquarie Infrastructure (MIC)	0.00	71-73	66-67
Mobileye N.V. (MBLY)	0.00	41-42	37-38
The Hain Celestial Group, Inc. (HAIN)	0.00	94-98	89-90
Broadcom Limited (AVGO)	266.26	81-85	75-76
Aruba Networks (ARUN)	0.00	20-21	18-19

Last week’s market break was decisive, as it took down just about every stock and sector. It also came on the heels of a few weeks of funky action, with small- and mid-cap indexes diverging (small-cap indexes are down a few percent on the year!), few growth stocks sustaining their upmoves and lots of choppy action. Could the market come storming back and resume its uptrend? Sure, anything is possible. But the evidence has clearly turned sour, and the odds are that the next bounce or two will be sellable. Thus, it’s best to turn defensive by selling some stocks, holding plenty of cash and limiting new buying to small positions.

That said, you should keep your shopping list ready—this week’s list has many recent earnings winners that continue to hold up well in the face of a weak market. Our Top Pick is U.S. Steel (X). The stock broke out from a solid base last week and exploded higher on enormous volume—and we think it can do well in this challenging environment.

Stock Name	Price	Buy Range	Loss Limit
United States Steel Corporation (X)	0.00	30.5-32.5	27.5-28.5
Western Digital Corporation (WDC)	0.00	98-100	93-94
Skechers (SKX)	0.00	50-52	45-46
Pacira Biosiences (PCRX)	54.85	93-95	84-85
Lam Research (LRCX)	268.47	67.5-69.5	64-65
Facebook, Inc. (FB)	0.00	70-73	66-67
Deckers Outdoor Corp. (DECK)	141.68	87-89	81-82
Chipotle Mexican Grill (CMG)	773.32	640-670	595-602
Celgene (CELG)	0.00	85-87	79-80
Baidu (BIDU)	0.00	200-210	192-194

Current Market Outlook


After weeks of banging on resistance, the major indexes lurched above some key levels last week, and many individual stocks did the same. To be fair, “breakouts” in indexes are notoriously unreliable, which is why we put more emphasis on the overall trend (choppy, but still positive) and the action of leading stocks (improving, though earnings season continues to have its say). Thus, while last week wasn’t a major buy signal, the weight of the evidence tells us to push our Market Monitor up a notch into bullish territory and continue to look for new leadership to emerge in the weeks ahead.

This week’s list has a wide variety of stocks, but for our Top Pick, we’re going with the mega-cap stock that just gapped up on earnings—Amazon’s (AMZN) surge last week pushed it out of a 15-month base as investors see huge potential for the firm’s cloud computing division.

Stock Name	Price	Buy Range	Loss Limit
Taser (TASR)	0.00	28-30	25-26
Men’s Wearhouse (MW)	0.00	55-57	50-51
Ligand Pharmaceuticals (LGND)	267.14	82-86	76-78
HD Supply Holdings, Inc. (HDS)	0.00	32-34	30-30.5
Hasbro (HAS)	0.00	69-72	65-66
GW Pharmaceuticals (GWPH)	174.52	115-120	103-105
Fortinet Inc. (FTNT)	137.53	37-39	34.5-35
Axalta Coating (AXTA)	0.00	29.5-31	27-28.5
Amazon.com (AMZN)	2.00	430-450	410-415
Akamai Technologies (AKAM)	0.00	73.5-76.5	68-69

Current Market Outlook


The major indexes are getting sloppier, with the S&P 500 and NYSE Composite now a couple of percent below their 50-day lines, and many individual stocks and sectors are getting hit. It’s not pretty, but this remains a split tape—the Nasdaq is holding up relatively well, for instance, and we’ve seen many growth stocks do OK in recent days, even as the market as a whole has dropped. Overall, we’re sticking with a neutral stance, which means holding some cash and being very selective on the buy side. It’s OK to pull the trigger if you see a good set-up or two, but honor your stops and don’t be afraid to book partial profits on the way up.

This week’s list is skewed toward the growth side of the equation, but has a mix of stocks that are in established uptrends and others that are just getting going. Our Top Pick is GoPro (GPRO), which has shown enough strength to tell us the March low was the bottom. Buy on dips and use a loose stop.

Stock Name	Price	Buy Range	Loss Limit
Zoës Kitchen (ZOES)	0.00	35.5-37.5	33.5-34
Zebra Technologies (ZBRA)	154.94	109-112	100-101
Skechers (SKX)	0.00	102-105	91-93
Shake Shack (SHAK)	92.08	73-76	66-68
Hologic (HOLX)	0.00	34.5-36	33-33.5
GoPro, Inc. (GPRO)	0.00	56-59	51-52
Global Payments Inc. (GPN)	0.00	104-105	98-99
Dexcom (DXCM)	421.36	70-72	65-66
Axalta Coating (AXTA)	0.00	34-35	31-32
AMAG Pharm. (AMAG)	0.00	68-70	62-63

Current Market Outlook


If we came down from another planet and looked at the state of the market, we would conclude that there are more things for the bulls to be excited about than not—few stocks have broken down, the indexes are above their 50-day lines and the major trends are still up.

But we’ve been around for the past month, and we know there’s clearly been an increase in distribution as investors fret over the reverberations of the oil price plunge. At the very least, not a lot of money has been made since mid-November. And that’s the reason we’re taking our foot off the gas; if the market and most stocks hold support, we’ll be quick to return to a more bullish stance, but for now, we think it’s best to do some watching and waiting, and possibly sell your weakest stock or two (and take partial profits in a winner or two).

This week’s list is more growth oriented than in recent weeks as investors abandon all things commodity-related. Our Top Pick is Restoration Hardware (RH) which has a great growth story and just broke out to new highs last week.

Stock Name	Price	Buy Range	Loss Limit
United Continental Holdings (UAL)	96.76	62.5-64.5	58-59
Sierra Wireless (SWIR)	0.00	39-41	37-38
RH Inc. (RH)	252.93	91-95	84-85
Outerwall Inc, (OUTR)	0.00	70-73	63-64
Lululemon Athletica (LULU)	304.69	50-52	45-47
Fiesta Restaurants (FRGI)	0.00	61-63	58-59
Dollar Tree (DLTR)	0.00	66-68	60-62
Centene (CNC)	0.00	99-102	90-92
Buffalo Wild Wings (BWLD)	0.00	164-170	152-154
Adobe Inc. (ADBE)	315.23	73-75	66-68

Current Market Outlook


After many weeks of choppy action, the sellers sunk their teeth into many indexes and stocks last week. Friday’s rebound was encouraging, but by our measures, the intermediate-term trend is sideways-to-down, the broad market is weak and few stocks are making any sustained upside moves—i.e., there’s still no money being made out there. On the positive side, many stocks remain near the top of multi-month ranges, and if earnings season goes well, plenty of new leadership could emerge. But right now, the onus is on the bulls to prove that they can create a sustained uptrend in the market and individual stocks. We’re knocking our Market Monitor to neutral and will be watching the action closely.

This week’s list has many resilient stocks that could be part of that new leadership if the bulls step up their game. Our Top Pick is Mohawk Industries (MHK), which is one of a few very strong housing supply stocks and has a recent catalyst to boot.

Stock Name	Price	Buy Range	Loss Limit
United Therapeutics (UTHR)	0.00	137-139	130-132
Taser (TASR)	0.00	24-25	22-23
Royal Caribbean Cruises (RCL)	0.00	80-82	75-76
Pharmacyclics (PCYC)	0.00	140-145	130-133
Outerwall Inc, (OUTR)	0.00	73-75	68-69
NetEase, Inc. (NTES)	0.00	104-108	96-98
Mohawk Industries (MHK)	0.00	160-165	150-153
HDFC Bank Limited (HDB)	0.00	54-56	50-52
Celgene (CELG)	0.00	117-122	108-111
Acuity Brands (AYI)	0.00	145-150	135-136

In the June issue of Cabot Early Opportunities we add a conservative stock from our Watch List that’s acted well over the last month and also take a partial position in an emerging player in the energy space. We also refresh the Watch List with a pure-play beverage stock, a biotech stock with a big date in November and another emerging energy name.
Enjoy!

Current Market Outlook


From a top-down perspective, nothing has really changed with the key evidence; there remain a couple of divergences (number of new highs, lagging small-cap indexes), but the intermediate-term trends of the major indexes and most leading stocks (and even non-leading stocks) are pointed up. Under the surface, though, we’re seeing some ping pong action—the major indexes have been alternating up and down days for the past couple of weeks, while many sectors are whipping in and out of favor on a weekly basis. (Growth stocks have been alternating good and bad weeks for a month.) What does it mean? It’s fair to say the broad buying pressures have eased up, though to this point, the sellers haven’t done much damage at all. We’re going along with the back-and-forth action, nudging our Market Monitor down a notch—we remain overall bullish, but the current earnings season will have a lot to say about the intermediate-term outlook for the market and leading stocks.

In the meantime, we’re still seeing a good number of setups from a wide variety of stocks and sectors. We have a couple of favorites this week, but for our Top Pick we’ll go with Qualcomm (QCOM), which has shown extreme power after a game-changing deal with Apple last week. We’re OK buying here or (preferably) on dips.

Stock Name	Price	Buy Range	Loss Limit
Ctrip.com International Ltd. (CTRP)	34.94	42.5-44.5	39-40.5
D. R. Horton (DHI)	66.55	43-45.5	39.5-41.5
Fastenal (FAST)	37.08	67.5-69.5	62.5-64
First Solar (FSLR)	83.74	57-59	52.5-54
Five Below (FIVE)	134.58	136-142	124-127
Kansas City Southern (KSU)	176.54	121-124	112-113.5
ManpowerGroup (MAN)	90.84	93.5-95.5	84.5-86
Microchip Technology (MCHP)	79.12	95-97	88-89
QUALCOMM Incorporated (QCOM)	106.36	78-82	69-71
Redfin (RDFN)	40.40	21-22	19-19.5

Current Market Outlook


The overall market remains in good shape, with the major indexes and most leading stocks in uptrends. That said, today was a very bad day for growth stocks, as big investors hit the sell button almost from the get-go, leaving most of this year’s winners down sharply. Given the monstrous runs in many of these names and (in some cases) some recent stalling out action, we do take this as a yellow flag—however, to be fair, few have broken any key support and most non-growth issues look completely fine. Bottom line, if you have some good-sized profits and positions, we’re OK booking a couple of partial profits and honoring stops and loss limits going forward. On the buy side, we continue lean toward “fresher” titles, including many steadier growers that have come into favor.
This week’s list has a bunch of names that, until recently, have been marking time, but now look to have begun steady uptrends. Our Top Pick is Teradyne (TER), which leapt out of a huge base on earnings last week.

Stock Name	Price	Buy Range	Loss Limit
Chipotle Mexican Grill (CMG)	773.32	780-805	710-720
Etsy (ETSY)	112.97	67-69.5	59-61
Kirkland Lake Gold (KL)	51.30	43-46	38.5-40
Lithia Motors Inc. (LAD)	146.30	129-132	118-120
Meritage Homes (MTH)	102.20	60.5-63.5	54.5-56.5
New Oriental Education (EDU)	113.97	102-106	91-93.5
Sherwin-Williams (SHW)	526.09	490-505	455-460
Snap Inc. (SNAP)	16.68	16.8-18	14-15
Teradyne (TER)	82.83	55-58	48.5-50.5
TransUnion (TRU)	83.09	79-82	72-73.5

Current Market Outlook


The market had put together a few small positive steps heading into last week, but after a solid G20-induced rally on Monday, it’s been all selling, all the time—the intermediate-term trend has rejoined the longer-term trend in bearish territory, with some indexes (including the S&P 500 today) hitting new correction lows. Because of that, we’re moving our Market Monitor back down a notch to a level 4 and advise remaining in a defensive stance. That said, it’s not all bad news; we’re seeing more stocks that are resisting the market’s pull (forming significantly higher lows), and many indexes are still being defended at their October/November lows. Bottom line, it’s best to take things day-by-day and go with the evidence—which, today, means holding plenty of cash.

This week’s list, though, is a good place to start building a watch list if you’ve yet to do so, as many of these stocks look like they want to move higher if the market gets going. Our Top Pick is MongoDB (MDB), a stock that actually nosed to new highs after earnings before pulling back in.

Stock Name	Price	Buy Range	Loss Limit
Guardant Health (GH)	88.34	42-44.5	36.5-38
Kirkland Lake Gold (KL)	51.30	22-23.5	20-21
LHC Group (LHCG)	103.10	97.5-100	89-91
MongoDB (MDB)	156.56	80-84	70-72.5
Okta, Inc. (OKTA)	148.41	61-64.5	54-56
RH Inc. (RH)	252.93	132-138	119-123
Shopify (SHOP)	585.00	143-150	130-134
Spirit Airlines (SAVE)	57.03	57.5-60.5	52-53.5
Vanda Pharmaceuticals (VNDA)	31.04	26-28	22.5-23.5
Zscaler (ZS)	126.22	38.5-41	33.5-35.5

Current Market Outlook


The market had another constructive week, and today, the S&P 500 actually nosed out to new highs, with the Nasdaq close behind. While small- and mid-cap indexes are still further behind, the tenor of the overall market continues to improve—it’s likely not up and away, but the odds continue to favor the next big move being up. Individual stocks remain far trickier, with rotation occurring daily, but our thoughts from last week haven’t changed much: Given the many solid setups out there, a positive earnings season could launch a bunch of new leaders we can hop on (we think we’ve already highlighted some of them), but it’s still up to the bulls to produce a bunch more powerful breakouts in the indexes and individual stocks.

This week’s list is a mix of recent earnings winners and others that are set up nicely ahead of reports this week. Our Top Pick is Vertex Pharmaceuticals (VRTX), which might finally be getting going after years of ups and downs. Earnings are due Wednesday evening so handle with care.

Stock Name	Price	Buy Range	Loss Limit
ACADIA Pharmaceuticals (ACAD)	47.84	40-42.5	35-36.5
Allegiant Travel (ALGT)	170.65	164-168	151-153
Fortune Brands Home & Security (FBHS)	81.02	58-60	53.5-54.5
Lam Research (LRCX)	268.47	260-270	240-245
Pinduoduo (PDD)	87.53	39.5-41.5	35-36
Reliance Steel & Aluminum Co. (RS)	117.45	114-118.5	103-105
Seattle Genetics (SGEN)	150.85	99-103	89-91
Teladoc, Inc. (TDOC)	127.95	69-72	62-63.5
Valero Energy (VLO)	97.40	95-98.5	86-88
Vertex Pharmaceuticals (VRTX)	230.36	191-196	178-180

Current Market Outlook


The market’s correction was in full force a week ago, with the S&P and Nasdaq falling to new correction lows and many resilient stocks beginning to give up the ghost. But since then stocks have turned on a dime—whatever the reason (Fed, less-heated trade rhetoric, Mexico deal), the market has soared amidst a vacuum of selling pressure, with the major indexes, the broad market (most number of stocks hitting new highs in months) and many growth stocks all kicking into gear. That said, the intermediate-term trend has not yet turned positive (it’s very close, but not quite there yet) and many stocks are now either extended or running into resistance, so we don’t advise throwing caution to the wind. But there’s no question that the action is encouraging —we’re bumping up our Market Monitor to a level 7 tonight.

This week’s list has a nice batch of stocks, including a few that are hot and others that are just emerging. Our Top Pick is Zillow (Z), which has changed character over the past few weeks and looks like a leader should the market’s rally continue.

Stock Name	Price	Buy Range	Loss Limit
Ciena (CIEN)	44.25	42.5-44.5	38.5-40
Coupa Software (COUP)	262.20	118-124	104-107
The Walt Disney Company (DIS)	144.76	135-138	125-127
Kirkland Lake Gold (KL)	51.30	36-38	32.5-33.5
MongoDB (MDB)	156.56	165-170	149-152
PagSeguro Digital (PAGS)	35.09	34.5-36	30.5-32
UniQure (QURE)	74.08	72.5-75.5	63-65
Vulcan Materials Company (VMC)	137.10	131-135	121-124
Zillow (Z)	76.64	44.5-46.5	40-41.5
Zoom Communications (ZM)	155.83	95-102	81-85

Thank you for subscribing to the Cabot Turnaround Letter. We hope you enjoy reading the February 2021 issue.

This month we look at energy pipeline stocks. These companies are heavily out of favor, yet a secular shift in their strategic priorities may finally restore their appeal. We list five that look attractive.



We also explore some bargains in the United Kingdom. This island nation is dually challenged by Brexit and the pandemic. We highlight seven stocks that have company-specific turnarounds that look promising.



Our feature recommendation is Viatris (VTRS). Created through the recent merger of Mylan and Pfizer’s Upjohn division, this company is now one of the world’s largest generic pharmaceutical manufacturers. Viatris should generate stable revenues and solid free cash flow, but investor skepticism is high. With the shares trading at a low 4.3x earnings, the step-up in leadership quality and transparency, and an attractive 5.2% dividend yield, the shares look poised for considerable gains.



We also include comments on recent price target and ratings changes, including our earlier sell recommendation on DuPont.



Please feel free to send me your questions and comments. This newsletter is written for you. A great way to get more out of your letter is to let me know what you are looking for.



I’m best reachable at Bruce@CabotWealth.com. I’ll do my best to respond as quickly as possible.

Current Market Outlook


Not much has changed with the market’s tenor during the past week. The major trends are still positive, but not powerful, with many indexes not making much headway during the past two months. And for individual stocks, again, there’s more good than bad, but the advance is narrow and news driven, and we’re seeing more buying of defensive stocks. Overall, we’re still more positive than not because most of the evidence favors the bull side—and it’s worth noting that it wouldn’t take more than a couple of good days to get all the major indexes to all-time highs! But we also think it’s a good idea to go slow, look for solid entry points and, of course, honor your stops. We’re keeping our Market Monitor at a level 7.
This week’s list has a nice mix of solid stories from a few different industries. Our Top Pick is a stock that’s been a leader all year—Coupa Software (COUP), which has tightened up after a couple of months of consolidation. Start small and see what comes on earnings early next month.

Stock Name	Price	Buy Range	Loss Limit
CenturyLink (CTL)	22.88	22.5-24	19.8-20.3
Chipotle Mexican Grill (CMG)	773.32	490-505	455-460
Coupa Software (COUP)	262.20	64.5-67.5	58-60
Dexcom (DXCM)	421.36	124-130	107-111
Five9 (FIVN)	78.35	41.5-44	37.5-39
The Flowserve Corporation (FLS)	54.70	49-51	44-47
Ligand Pharmaceuticals (LGND)	267.14	232-242	206-216
Sendgrid (SEND)	33.32	30-32	28-29
Trade Desk (TTD)	468.02	120-130	104-109
Trex Company (TREX)	117.56	76-80	70-72

Current Market Outlook


After what was basically a straight-up move for the major indexes and many leading stocks during the past three weeks (including a few names that got out of trend on the upside), big investors came back from the beach today and took some profits. And short-term, further retrenchment is possible, so don’t be surprised to see a few potholes or rotation show up. But bigger picture, the trends of the indexes are pointed up, leading stocks are acting well and we’re pleased to see buying pressures broadening (more new highs) and selling pressure fading (relatively few new lows). It’s still a good idea to pick your spots and take a partial profit or two on the way up, but we remain bullish and see the odds favoring higher prices in the weeks ahead.

This week’s list has a wide mix of stocks and sectors, reflecting the broadening of the market’s advance. Our Top Pick is Semtech (SMTC), a smaller chip maker with a pretty chart and excellent growth.

Stock Name	Price	Buy Range	Loss Limit
Allison Transmission (ALSN)	51.79	48-50	44.5-45.5
Ciena (CIEN)	44.25	30-32	26.5-27.5
DSW Inc. (DSW)	31.82	31-32.5	28-29
Exact Sciences (EXAS)	116.91	71-75	62-64.5
HCA Healthcare (HCA)	137.60	125-132	115-119
iRobot (IRBT)	103.17	107-111	94-96
NVIDIA Corporation (NVDA)	242.42	273-284	252-258
Semtech (SMTC)	51.09	56.5-60	50-52
Veeva Systems (VEEV)	180.23	98-102	89-91
Wayfair (W)	167.03	133-137	117-120

Current Market Outlook


Ever since the mini-blowoff we saw in growth stocks in mid June, the market has been choppy, narrow and tough to maneuver, with many individual stocks going nowhere and a handful of leaders flashing abnormal intermediate-term action. But the character of the market seems to have changed during the past couple of weeks—the day-to-day rotation is gone, leading growth stocks have generally resumed their advances and the major indexes have moved to new highs. It’s still not 1999 out there, of course, and a big factor will be how the market reacts once big investors return from the beach next week. But there’s no question the evidence continues to improve, so we’re bumping up our Market Monitor to a level 8 (out of 10).

This week’s list has a bunch of good setups and great breakouts from growth-oriented stocks. Our Top Pick is Pure Storage (PSTG), which looks like it has recovered from the choppy action of the past few quarters.

Stock Name	Price	Buy Range	Loss Limit
Autodesk (ADSK)	229.00	150-155	137-140
DocuSign (DOCU)	107.98	63-66	55-57
Horizon Therapeutics (HZNP)	49.89	19.5-20.5	17.5-18.5
Nordstrom Inc (JWN)	60.72	58-61	53.5-55.5
Novocure (NVCR)	0.00	38-40	33-34
PetIQ (PETQ)	30.82	35.5-38	30-31.5
Pure Storage (PSTG)	25.64	25-26.5	22.5-23.5
SailPoint Technologies (SAIL)	31.60	29-31	26.5-27.5
Splunk (SPLK)	207.67	117-122	105-108
Williams-Sonoma (WSM)	64.96	66-69	61-62.5

Current Market Outlook


The calendar has flipped, but the market environment remains bullish, with the major trends of most indexes and leading stocks continuing to point up. Today saw some rotation back into a few of last year’s leading growth stocks, but we wouldn’t jump to conclusions quite yet—January is known for lots of volatility as big investors reposition their portfolios and, in a couple of weeks, as earnings season gets underway. You should keep your feet on the ground and honor your stops, but you shouldn’t get carried away with daily moves over the next few days; ideally, try to buy strong stocks on normal dips. For overall stance, you should remain bullish.

This week’s list has a nice mix of great stories and charts, ranging from a speculative biotech to a couple of strong energy stocks. Our Top Pick, though, is one of the largest copper miners in the world—Freeport McMoRan (FCX) appears to have blasted off and entered a sustained uptrend after forming a very long launching pad. Try to buy on dips.

Stock Name	Price	Buy Range	Loss Limit
Adamas Pharmaceutical (ADMS)	0.00	32.5-35.5	29-30
American Woodmark (AMWD)	0.00	126-131	113-116
Burlington Stores (BURL)	193.95	115-120	105-108
Diamondback Energy (FANG)	0.00	122-126	110-113
Freeport-McMoRan Inc. (FCX)	13.78	18.5-19.5	16.5-17.2
Floor & Décor (FND)	68.03	44.5-47	41-43
Ollie’s Bargain Outlet (OLLI)	103.94	50.5-52.5	47-48.5
Penn National Gaming (PENN)	45.38	29.5-31	26.5-28
ProPetro (PUMP)	23.30	18.9-19.7	17.2-17.7
Warrior Met Coal (HCC)	0.00	24-26	21-22

Current Market Outlook


The major indexes bounced decently last week, though that was quickly given back today as the sellers reappeared. Day-to-day volatility is likely to remain high as the market remains news-driven (the 50-day average of the VIX volatility index is the highest in two years), but the bottom line for the overall market is simple: All of the major indexes we track are below their key intermediate-term moving averages, so until proven otherwise, the trend is down and you should remain cautious. As for individual stocks, many are still in good shape, but with the sellers in control, any buying should be kept small and all stops should be honored. We’re nudging down our Market Monitor another notch to reflect the growing selling pressures we see.

This week’s list does contain a bunch of solid charts despite the market’s carnage, which is an encouraging sign. Our Top Pick is Lululemon (LULU), which is one of many resilient retail names and has just gapped up on earnings.

Stock Name	Price	Buy Range	Loss Limit
Energen (EGN)	77.04	59-61	55-56
Five Below (FIVE)	134.58	70-73	64.5-66.5
Guess (GES)	0.00	19.5-20.5	17.5-18
Kohl’s (KSS)	70.62	61-63	56-58
Lululemon Athletica (LULU)	304.69	85-88	80-82
Okta, Inc. (OKTA)	148.41	37.5-39.5	34.5-36
Petrobras (PBR)	14.78	13.2-14.2	12.1-12.8
Shutterfly (SFLY)	94.71	76-79	70-72
Smart Global (SGH)	0.00	46.5-49.5	42-44
Wix.com (WIX)	302.53	74-77.5	68-71

The market stalled out a bit last week, which is normal considering its recent advance. Overall, our Market Monitor remains bullish, as the trends of most stocks and the major indexes are solidly up. That said, you shouldn’t be surprised if there’s a bit of turbulence coming up; we’re not predicting that, but we did notice some slippage in a few key growth stocks last week, and earnings season, which technically began a few days ago, really heats up during the next three weeks, and that almost always adds to volatility. That’s not a reason to turn cautious—it’s likely some new leadership will emerge on their earnings reports, after all—but just a heads up to make sure you have a battle plan going ahead, namely, stick with what keeps working and rotate out of stuff that breaks down.
This week’s list is a good reflection of the current environment—a few growth stocks but mostly cyclical and turnaround-type names are where the money is flowing. Our favorite of the week is BlackRock (BLK), a huge “Bull Market stock” that reported a great quarter last week. It’s not going to triple, but after a long rest period the stock is under very strong accumulation.

Stock Name	Price	Buy Range	Loss Limit
Valero Energy (VLO)	97.40	34-36	-
United Rentals, Inc. (URI)	0.00	46-48	-
Morgan Stanley (MS)	0.00	20.5-21.5	-
Melco Crown (MPEL)	0.00	18-19.5	-
HCA Healthcare (HCA)	137.60	35-36	-
Keurig Green Mountain (GMCR)	0.00	36-39	-
Ford Motor Co. (F)	0.00	13.5-14	-
Equinix, Inc. (EQIX)	547.73	213-220	-
Copa Holdings (CPA)	0.00	104-108	-
BlackRock (BLK)	0.00	220-230	-