I have always observed that stocks tend to move like a school of fish, that is together in a group. If you start to notice, for example, that one steel stock is behaving well its fairly likely that the others will be as well. It's also worth noting that there is always a bull market someplace. For example in the middle of the bear market that started in March of 2000 SYY broke out above $20 per share. While most stocks were in the process of shedding 50% to 80% of their market value's, SYY was up over 50%. Other names in its group showed gains of between 20% to 200%, and again this was during an equity meltdown of a severity not ever seen before. William Oneil, in his classic text "How to make money in stocks" states that 37% of a stocks movement will be tied directly to the performance of its industry group, while another 12% is due to the general sector. All of this should leave no doubt in your mind as to how important being in the right groups at the right time is. With that in mind I have decided to start sharing some of my weekly research on sectors and groups with you here on my blog and a few message boards. This info will be basic in nature, but it will always be free. I hope that it can provide something of a jumping off point for your research and will be useful. This week as I looked at the groups of stocks I found myself liking Stem Cells, Real Estate Operations, General Industrial Machinery, Medical Systems and Equipment, Hotels, Oil and Gas Machinery and Gaming on the upside. On the downside Steel stocks stood out to me, and Semiconductors will if they break down too much further. In general the market remains in a tight trading range and I feel it is likely to remain that way for a long time. That means that stock and group selection will remain very important. Brandon PS, Please note that I will be starting a chatroom on Hotcomm on Tuesday July 5th. It will remain free over the course of the summer and probably a little bit beyond that. If you are interested in coming by there will be info posted on my website with in the next fee days. We are on Relay in SwingTradingChannel.
I use IBD's Industry Groups service (www.dailygraphs.com) Jeff Semmels Trading Scans (www.tradingscans.com) and also www.bullsector.com Brandon