Stock Market Leadership
Stock Market Leadership
Stocks that act fresh while the Market is selling off may give you a clue to new Leadership
Over the past few years many investors have disposed unraveling on the market especially when another round of selling has occurred. However this is by faithfully the wrong time to give-up on the market because when the market overturns to the upside those stocks, had been acting well during the sell off may become the next big winners.
Here are a few examples of what I’m speaking about. Let us judge against the charts of HITK and USNA with chart of the S&P 500 past Summer and Fall when the market was selling as off.
Looking at HITK first shows that this past Summer and Fall eternity the S&P 500 was dropping ( points A to B ) HITK was actually rising ( points C to D ) while completing the right part of a 1 1 / 2 year Cup. HITK then traded sidewise for 4 weeks moment developing a Handle ( point E ) and whence broke superficial in late October. After breaking outer HITK nearly doubled in price over the next few months before topping out in early January.
Now let us go to compare USNA with the S&P 500. USNA formed a 2 1 / 2 year Cup from the pioneer part of 2000 until June of 2002. When the S&P 500 had began to sell off last Summer and Fall USNA fundamentally traded sideways during that period of time while developing a 4 month Handle from July through September. Then when the market made a bottom in early October and began to rally USNA broke out of its Handle on huge compass ( point F ). Attached breaking out in incipient October USNA then doubled in price over the next three months.
As you can see noticing which stocks are theatre well when the market is selling off can give you a clue to whom the next leaders will be when the market begins to reverse strongly to the upside.