February 26th, 2006

Stocks with breakout potential

“People in glass houses shouldn’t throw stones.” Lest you believe that I only critique the comments of others, like Jim Cramer or IBD, I’ll now tell you the industry groups and stocks that I just added to my price trigger watchlist.

Fequent readers are familiar with my complaining that Cramer, IBD and others select stocks and tell us about them after they’ve made huge moves. Perhaps it’s safe and perhaps, often, those stocks continue to move to even higher levels. I must confess that I, too, frequently buy stocks in these lists, still hold many and do make nice profits.

But there are psychic rewards, added to the financial, by finding stocks just as they begin their moves, as when money flows rotate among various industries. It’s a mathematical truth that the greatest percentage gains are at the beginning of a stock’s move. But greater rewards are also associated with some increased risk as when some of these early moves fail to hold. That’s

The industries that appear to have improved significantly over the past 3 months include:

  • Computer-Data Storage
  • Internet-Network Solutions
  • Medical-Genetics
  • Metal Products-Distributor
  • Electronics-Contract Mfg
  • Chemicals-Plastics
  • Agricultural Operations

And from the 133 stocks included in these industry groups, I added to my trigger watchlist 39 with charts that look like breakthrough resistance trendlines are possible and even imminent; some I think have the clearest possibility of future upside breakouts include (those with links are to charts) :

  • Alico Corp (ALCO)
  • Cabot Corp (CBT)
  • Cisco (CSCO)
  • Cytec (CYTC)
  • Decode Genetics (DCGN)
  • Echelon Corp (ELON)
  • EMC Corp (EMC)
  • Foundry Networks (FDRY)
  • W R Grace (GRA)
  • NanoPhase Technologies (NANX)
  • QLogic Corp (QLGC)
  • Radware Ltd. (RDWR)
  • Rhodia ADR (RHA)
  • Rogers Corp (ROG)
  • Symyx Technologies (SMMX)
  • WD-40 Co. (WDFC)

Subscribe below or click here to learn more about help for navigating turbulent markets.