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As we begin the second half of the year, the odds continue to favor higher prices for the market down the road, so we remain in a generally bullish stance. Of course, the short-term will likely be news driven (trade talk, war fears and earnings season), but the big picture is looking sunny.
Individual growth stocks are a bit more divergent, with some looking tired but other, newer leaders looking peppy.

In tonight’s issue, we give you our latest thoughts on each of our stocks and take a deep dive into the issue of handling big winners—a skill that few practice, but done right, it will make a huge difference in your portfolio.

Current Market Outlook


Today saw another rotation day, with strong selling showing up among leading growth stocks while the broad market was relatively flat and some areas (financials, energy) perking up. As usual, we’ll see if today is the start of something more pronounced; the Nasdaq bumped up against its early June highs this morning, so if the selling continues, we could be looking at an intermediate-term top. However, it’s too early to conclude that—most major indexes remain in clear uptrends, as do the vast majority of leading stocks despite a few bouts of selling in recent weeks. Thus, we remain mostly bullish, holding our winners and looking to hop on new leadership that’s emerging.

This week’s list has another batch of strong growth-oriented stocks, and encouragingly, many are new names from sectors that have recently come to life. Our Top Pick is Celgene (CELG), which looks like a big-cap leader of the new uptrend in biotech stocks.

Stock Name	Price	Buy Range	Loss Limit
Autohome (ATHM)	98.65	43.5-45.5	40-41
Celgene (CELG)	0.00	130-134	122-124
Clovis Oncology (CLVS)	0.00	88-93	82-83
Paycom Software (PAYC)	0.00	69-72	63-66
Planet Fitness (PLNT)	0.00	22.7-23.7	21.2-21.8
Red Hat (RHT)	0.00	96-100	89-91
Tesla, Inc. (TSLA)	818.87	355-375	326-330
Trivago (TRVG)	0.00	19.5-21	17-18
U.S. Concrete (USCR)	0.00	74-78	67-69
XPO Logistics (XPO)	0.00	59-62	53.5-55.5

Current Market Outlook


There are a still a couple of flies in the market’s ointment, but the past week or two has seen the market broaden out—the Nasdaq and growth stocks are still leading the way, but the S&P 500 and NYSE Composite have joined them in new high ground, and even the lagging small- and mid-cap indexes have perked up. Market-wise, then, the evidence has improved, so we’re nudging up our Market Monitor to a level 9. Just as important, though, is handling your stocks correctly—right now, many are extended to the upside, though some are just emerging while others look like great buys on any dips. Long story short, you should remain bullish, but honor your stops and continue to pick your spots on the buy side.

This week’s list has another batch of strong growth stocks. Our Top Pick is JD.com (JD), which catapulted to all-time highs a month ago on earnings and has calmly consolidated since.

Stock Name	Price	Buy Range	Loss Limit
Autodesk (ADSK)	229.00	107-112	99-102
Bob Evans Farms (BOBE)	0.00	67-70	62-63.5
Broadcom Limited (AVGO)	266.26	245-255	227-232
Graco Inc (GGG)	0.00	109-113	101-103
JD.com (JD)	39.58	38-40	35-36.5
Lumentum (LITE)	87.00	56-58	51-52.5
Marriott Vacations (VAC)	0.00	116-120	105-108
Marvell Technology Group (MRVL)	36.88	16.8-17.5	15.8-16.2
ServiceNow (NOW)	341.86	102-105.5	95.5-97.5
Weibo (WB)	98.16	73-76	66-68

The market’s main trend remains up, though there is certainly some rotation going on, with technology stocks pulling back and financials and medical stocks surging. My advice is to react slowly to these shifts, taking things on a stock by stock basis according to what the stocks are actually doing—and not assuming anything.

While it’s pretty clear that the world isn’t going to calm down or stop giving investors heart attacks every week or so, it’s also clear that investors are ready and willing to put money into growth stocks. That’s what’s driving the buy signal from the Cabot Emerging Markets Timer and the performance of our portfolio.

Investors’ jitters about the dog fight in Washington, D.C. caused a sharp market correction this week that included emerging market stocks. Our portfolio also sustained a little damage, but, so far at least, it’s under control. The major uptrend in emerging markets has been dulled, but not blunted. In this issue, I look at the performance of emerging vs. developed market stocks. I also bring back a stock from last year that will give us a different take on Chinese retail.

Current Market Outlook


A lot has changed since our last issue two weeks ago! Most important of all is the “blast-off” or “volume thrust” signal that came from two consecutive days (December 17 of 18) of very broad and powerful upside market action. It was strong enough to erase any lingering negative technical action, setting the stage not only for a nice Christmas rally but also the traditionally solid start to January that we expect. Thus our Market Monitor is now solidly back in the green bullish zone. So what to buy? Not oil stocks; it’s better to focus on what’s going up! Today’s issue brings a diverse group of both big old companies and younger faster growers, and all of them have great potential, but our Top Pick is Freescale Semiconductor (FSL), a chip manufacturer that has great potential to benefit from the boom in machine-to-machine (MTM) communication.

Stock Name	Price	Buy Range	Loss Limit
Whirlpool (WHR)	0.00	184-193	173-175
Taser (TASR)	0.00	25-26.5	23-24
Swift Transportation (SWFT)	0.00	27.5-29	25-26.6
RockTenn (RKT)	0.00	59-61	55-56
Red Hat (RHT)	0.00	69-71	66-67
ServiceNow (NOW)	341.86	67-70	62-63
Hawaiian Holdings Inc. (HA)	0.00	22.5-24	19-20
Freescale Semiconductor (FSL)	0.00	24-25	21-22
Bluebird Bio (BLUE)	0.00	83-87	75-77
Broadcom Limited (AVGO)	266.26	98-101	93-94

Current Market Outlook


With some weekend polls showing the chance of a “Brexit” lessening, the market gapped up this morning and finished with solid gains. Today’s rally is obviously encouraging and hints that, should the vote on Thursday go as expected, buyers could take control afterwards. Still, as always, we don’t predict—right now, the evidence remains more bullish than not, so it’s best to hold your strong, profitable stocks and add new leaders as they develop. That said, the intermediate-term trend of the indexes is mostly neutral, and until the uncertainty clears up, it’s a good idea to keep new positions smaller than normal, and to honor your stops and loss limits.



The good news is that most top performing stocks handled the market’s 3% dip in fine fashion. This week’s list is another batch of (mostly familiar) names that look great. Our Top Pick is Weibo (WB), a little-known Chinese firm that looks like one of the market’s top glamour stocks.

Stock Name	Price	Buy Range	Loss Limit
wb (wb)	0.00	26-27.5	23.5-24.5
symc (symc)	0.00	19.5-20.5	18-18.5
simo (simo)	0.00	43-45	39.5-40.5
oled (oled)	0.00	67-69	60-62
nvro (nvro)	0.00	71.5-74	66.5-67.5
nuva (nuva)	0.00	57-59	54-55
lulu (lulu)	0.00	69.5-71.5	66-66.5
five (five)	0.00	44-45.5	41-41.5
cprt (cprt)	0.00	47.5-49.5	44-44.5
Barrick Gold (ABX)	0.00	19-20.5	17-17.5

Current Market Outlook


With Greece on the brink of defaulting on some loans and/or exiting the eurozone, the uncertainly of what’s to come caused sellers to drive the indexes and most stocks down sharply today. The straight-down action of the past few days, which came on the heels of some encouraging gains, is a yellow flag, as are the downmoves of many stocks. As we’ve been writing, you should honor your stops (many stocks tripped their stops today) and be holding at least some cash on the sideline. That said, while we’re knocking our Market Monitor down a notch today, the bigger picture hasn’t changed—the major indexes are still within their multi-month ranges, and the best stocks are pulling back normally, so we don’t advise selling wholesale.


This week’s list has many strong stocks that have held up well during the recent selloff. Our Top Pick is Community Health Systems (CYH), which just exploded out of a base following a big court ruling last week. Try to buy on dips.

Stock Name	Price	Buy Range	Loss Limit
SVB Financial Group (SIVB)	0.00	141-145	135-137
Sealed Air (SEE)	0.00	51-52.5	47.5-48
Lennar (LEN)	61.85	50-52	47-47.5
IACI (IACI)	0.00	77-79	73-74
Facebook, Inc. (FB)	0.00	84.5-87	81.5-82
Community Health Systems (CYH)	0.00	61-63	57-58
Carnival Corporation (CCL)	0.00	48-49.5	46.5-47
Avery Dennison Corp. (AVY)	0.00	60-61.5	57-58
Arista Networks (ANET)	0.00	79-82	74-75
Adobe Inc. (ADBE)	315.23	80-82	76-77