January 23rd, 2006
Even with the stock market declining 2.03% for the week, with nearly all of it coming on Friday, twelve stocks were added to the IBD 100 list. Of those, 9 have appeared on the list in the past while 3 are totally new:
Even with the stock market declining 2.03% for the week, with nearly all of it coming on Friday, twelve stocks were added to the IBD 100 list. Of those, 9 have appeared on the list in the past while 3 are totally new. Six of the 12 are in an Oil& Gas Industry Group. Charts on RELV and FFIV are available by clicking on the symbols in the attached table:
|RELIV INTL||RELV||Cosmetics/Personal Care||17|
|SUPERIOR WELL SVCS INC||SWSI||Oil & Gas-Field Svce||38|
|F 5 NETWORKS INC||Internet-Network Solutions||50|
|MERIDIAN BIOSCIENCE INC||VIVO||Medical-Products||62|
|BOIS D’ARC ENERGY LLC||BDE||Oil&Gas-US Exploration &Dvlpmnt||68|
|I H S INC CL A||IHP||Retail-Restaurant||73|
|BERRY PETROLEUM CO CL A||BRY||Oil&Gas-US Exploration &Dvlpmnt||75|
|J 2 Global Communication||JCOM||Internet-ISP||89|
|ANADARKO PETROLEUM CORP||APC||Oil&Gas-US Exploration &Dvlpmnt||95|
|DEVON ENERGY CORP||DVN||Oil&Gas-US Exploration &Dvlpmnt||96|
|Unit Corp||UNT||Oil & Gas-Drilling||98|
FFIV, ranked 50 in last week’s IBD100 list has burned me several times over the past two years since it broke through the upper resistance trendline of an upward sloping triange at the beginning of 2005. It’s bounced back and forth between the upper and lower boundaries of an overlayed upward sloping wedge it’s been forming since the bottom in 2001.
I’ve found that an upward sloping wedge is one of the most difficult to read and they usually end up in downward, rather than upward, breakout. I would be cautious and alert as the price crawls closer to the apex of this wedge.
IHP, ranked 73 actually increased over 25% after originally breaking through towards the end of 2004. However, throughout nearly all of 2005 it retraced in a descending channel and retested the support trendline of that original breakthrough at 38.75. It successfully broke through the upper boundary of that channel at the end of last year. I would say that its addition to the list results from, and substantiated by, that breakout.
One of the most interesting “bumps” from the list is Builders Materials Holding (BMHC), a stock that has been on the list nearly every week (except for 10/14/05, 12/30/05 and 1/7/05) since April 1, 2005. BMHC is the case that proves the point of how hard it is to limit the list to a fixed number, like 100 stocks. I’m not sure how IBD makes their trade-off decisions but BMHC, from the chart at least, looks like a stock that could have, and perhaps should have, stayed on the list.
|Beazer Homes U S A Inc||BZH||Bldg-Resident/Cmml||37|
|SYNAPTICS INC||SYNA||Computer-Peripheral Equip||39|
|SHINHAN FINANCIAL GP ADR||SHG||Banks-Foreign||70|
|LOGITECH INTL SA ADR||LOGI||Computer-Peripheral Equip||72|
|LO JACK CORP||LOJN||Cmml Svces-Security/Safety||75|
|MICROSTRATEGY INC CL A||MSTR||Computer-Sftwr-Enterprise||76|
|MOTOROLA INC||MOT||Telecom-Wireless Equip||85|
|Jos A Bank Clothiers Inc||JOSB||Retail-Clothing||86|
|Building Materials Hldg||BMHC||Bldg-Construction Prod-Misc||87|
|BUILDERS FIRSTSOURCE INC||BLDR||Bldg-Construction Prod-Misc||88|
|VARIAN MEDICAL SYSTEMS||VAR||Medical-Systems/Equip||96|
BMHC at the present looks like it’s been in a downward sloping consolidation channel. But, given the apparent slow-down in the housing market, the chart may evolve into a head-and-shoulder type of top (see the dotted line neckline. If so, removal from the list was prescient; if not, we will probably see BMHC back on the list.