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In reviewing the charts of the major U.S. stock market indexes, I noticed that the Dow, the S&P 500 and the NASDAQ each look as if somebody is slogging uphill in deep thick mud. That’s a bit like a “two steps forward one step back” pattern.

I know that these trading fiascos are bad things ... and yet part of me is strangely pleased about them. I like having big object lessons that show what happens when people break the rules and refuse to cut their losses short. Rogue traders aren’t greedy criminals - none of the big ones have made any money for themselves on their dealings. But their mistakes remind us that anyone who reacts to losses by making increasingly riskier trades can parlay bad luck into a financial catastrophe of amazing proportions.

The S&P 500 crossed above its 25-day moving average line on April 6 and is back above its 50-day moving average line today. It is only 16% off its previous high. Granted, under the circumstances that doesn’t seem quite right. But nevertheless, there it is.

This month we’re jumping into a new IPO that’s following in the footsteps of Livongo and Teladoc, bringing an innovative digital health solution to the masses.

As with those firms, this company sells solutions to companies, but it is the end consumer that uses the products, which are aimed at improving engagement and health outcomes while reducing costs.



With limited history as a public company, an earnings report coming next week, and the recent news that Livongo and Teledoc will merge, I expect shares of this company will be somewhat volatile. Please be sure to average in. We are starting with BUY A HALF rating today.



All the details are inside this month’s Issue. Enjoy!

Forever Stock number five in our 2017 series is Baidu, often called the Google of China. Roughly one-ninth the size of Alphabet (Google) today, it is almost guaranteed to be larger in just a few years!

The market had many ups and downs last week, and despite a nasty sell-off on Thursday the indexes closed the week mostly higher. The S&P 500 gained 0.8%, the Dow lost 0.45%, and the Nasdaq rose by 2.26%.

The market had many ups and downs last week, and despite a nasty sell-off on Thursday the indexes closed the week mostly higher. The S&P 500 gained 0.8%, the Dow lost 0.45%, and the Nasdaq rose by 2.26%.

I am looking, as always, for the next big winner. So where might we find the next Tesla?

The overall market remains in good shape, with many indexes actually stretching to new highs this week. But growth stocks are another ball of wax, with many leaders having decisively cracked their uptrends and the Nasdaq itself stuck in no-man’s land even after this week’s bounce.

We’re open to anything, and in fact we’re putting a small piece of cash back to work tonight (buying a half-sized position in a high-potential stock), but we’re mostly going slow and waiting for growth stocks to set up properly. Our cash position will be right around 50%.

The overall market remains in an uptrend, as do most leading stocks, and that’s why we remain mostly bullish. But while we’re positive, we’re not pounding the table, partly because of some secondary measures (most broader indexes haven’t hit new highs in a month) but mostly because individual stocks aren’t offering up many great entry points. Tonight, then, we’re again standing pat, happy to ride our winners but monitoring earnings season closely, both for stocks we own and for those we want to buy.

In tonight’s issue, we go over a few new ideas, including a couple of IPOs from last year that were nailed but are now coming back from the dead; they could be morphing into leaders. And as usual we go over all of our current holdings and our updated watch list.

We’re beginning to see some short-term signs of spring in the market, first via some resiliency in the broad market, and now from buyers actually stepping up to the plate. We think there’s a decent chance the market has found a workable low, and we’re encouraged to see a decent number of growth stocks bounce back. All of that is good to see, but the primary evidence -- the trends of the market and most stocks --are still pointed down. We’re not ruling out a nibble or two if the buyers keep at it, but it’s best to remain defensive until we see more than a modest bounce.

In tonight’s issue we talk about one group that has seen some very big-volume buying of late, a sign big investors were eager to jump in on weakness. And we also review our remaining positions and a few other top-notch names we think could put on big runs once the market enters a new uptrend.

The market has done about as good a job as could be expected rebounding off its March 23 low, and that makes for an interesting setup next week: If the major indexes can continue to strengthen, we could get a Tides buy signal, and that could also coincide with some bullish blastoff signals, too. To this point, though, the trends have yet to turn up, so we advise a defensive stance -- but we’re certainly keeping our eyes peeled for further unusual strength.

During the past three-plus months, the market has put in a firm foundation, with numerous tests of long-term support, positive divergences among various breadth measures and three legs down to the correction. And now we’re starting to see buyers take control—today our Cabot Tides flashed a green light, telling us to begin putting money to work.

The market continued to inch its way higher in the two weeks since I last wrote. The Stock of the Week portfolio isn’t inching – it’s soaring. Multiple positions in our portfolio were up double-digit percentages in the last couple weeks, with several others hitting new 52-week or all-time highs. As always, it’s a testament to the elite stock-picking ability of our superb analysts. And today, we add another stock, a familiar name that has regained momentum enough to warrant inclusion in last week’s Cabot Top Ten Trader advisory.

Details inside.

Bull markets are a great phenomenon; they make you feel smart and they make you money.