Bulkowski's Watch List

Written by Thomas N. Bulkowski and copyright © 2008-2013 by Thomas N. Bulkowski. All rights reserved.

READ THIS: The following are NOT stocks I own or recommend people buy. This is just a shopping list of stocks I'm interested in buying. I may or may not buy them.

Consider these stocks as just the first cut in a long process of elimination. They have not been filtered for anything other than I find them interesting, so you should do additional research before trading them. I am not recommending that you buy any of these stocks. No stocks that I currently own appear in the list unless I bought it after I posted it. See the privacy statement and disclaimer for more information. I do not tout stocks that I own nor do I tout stocks on behalf of others.

I have a computer program that builds this list by finding the most recent chart pattern in the file. That may or may not be the one I am interested in, so keep that in mind. This list is updated whenever time allows. Stocks may appear or disappear without this list being updated.

Watch List Removal Philosophy

First, there are two reasons for a security listed in the Additions section to not appear in the list. The first is that I bought it. Stocks I own, as I mentioned above, will not appear in this list. I don't want to be accused to touting stuff I own.

Second, is that I conducted more research or something happened in the markets which caused me to remove the security from my shopping list. It fell out of favor for whatever reason. I don't disclose the reason for removal (I used to), because maintaining the list is just too much trouble.

Watch List

The following are NOT stocks I own or recommend people buy. This is just a shopping list of stocks I'm interested in buying. I may or may not buy them. Read the above introduction for more information.

If no securities appear in the list, then I don't see anything worth buying. Click on the symbol for a more detailed discussion of the security. This list is automatically generated, so the patterns found here are the most recent ones located in the stock, but are not necessarily the ones I am looking at. Read the list of additions for a more accurate picture.

Industry: Petroleum (Producing)

Industry RS rank: 33 out of 53

Stock RS rank: 456 out of 617

Close as of 05/09/2013: $52.77

1 Month average volatility: $1.29. Volatility based stop (assuming upward breakout): $49.51 or 6.2% below the close.

Change YTD: 15.24%

Volume: 366,900 shares

3 month avg volume: 631,358 shares

Based on up closes since the 2009 bear market ended, the day with fewest up closes (best buy day) is Monday, and the most up closes (best sell day) is Wednesday.

 

Chart pattern: Pipe bottom reversal pattern from 04/15/2013 to 04/22/2013

Performance rank: 2 out of 23.

Breakout is upward 100% of the time.

Average rise: 45%.

Break-even failure rate: 5%.

Throwbacks occur 44% of the time.

Price meets the measure rule target 83% of the time.

Industry: Petroleum (Integrated)

Industry RS rank: 39 out of 53

Stock RS rank: 383 out of 617

Close as of 05/09/2013: $80.69

1 Month average volatility: $1.13. Volatility based stop (assuming upward breakout): $77.99 or 3.4% below the close.

Change YTD: 12.98%

Volume: 8,135,500 shares

3 month avg volume: 11,364,305 shares

Based on up closes since the 2009 bear market ended, the day with fewest up closes (best buy day) is Wednesday, and the most up closes (best sell day) is Thursday.

 

Chart pattern: Pipe bottom reversal pattern from 04/15/2013 to 04/22/2013

Performance rank: 2 out of 23.

Breakout is upward 100% of the time.

Average rise: 45%.

Break-even failure rate: 5%.

Throwbacks occur 44% of the time.

Price meets the measure rule target 83% of the time.

Watch List Additions

5/10/13: I added two securities to my shopping list. Why? Because I found an inordinate number of pipe bottoms in the oil sector and I want to drain some of the cash from my sale of ABFS.

The first is SPDR Energy Select Sector (XLE). This is an exchange traded fund. The top two holdings (Exxon-Mobile and Chevron) account for about a third of assets. Ouch. It's made a straight-line run from the April low, so I'll wait for it to reach the corrective phase of a measured move up ($77 to 79 range). This isn't cheap but it has lots of volume. If you want cheap, try IYE. It's half the price but a fraction of the volume, too (8m vs 200k).

Atwood Oceanics (ATW) is my second pick. The rating agencies are hot on this stock. It's another straight-line run from the April low, so I'm looking for a retrace, maybe down to 50.

3/3/13: I added Fifth and Pacific (FNP) because of a cloud bank pattern (2004-7) on the weekly scale. Target: 33. The stock is at 17.85. This used to be Liz Claiborne, so it's into women's clothes. General Electric (GE) is a large cap with a cloud bank (2004-8). Currently at 23.19. Cloud is at 32. I don't like large caps, but this also pays a 3.3% dividend. Textron (TXT) is another cloud bank setup by a trendline along the bottoms from 2004 to 2008. 28.47 currently with a target of maybe 50 or the trendline. Resistance begins at 38 and goes on up. Public Service Enterprise Group (PEG) is a utility yielding over 4%. It's flat lined for years (since last 2008, range bound between 29-34. It's at 32.85. If this breaks out of that range upward, that would be a nice hold. Payout ratio is 57% (as per yahoo.com), which is low for a utility. Arkansas Best (ABFS) is a plunge play. The stock hit bottom at 6.43 in November and has bounced. This is a trade to play that bounce, say, up to 18 from 11 now. You can think of this as a cloud bank (late 2007 to early 2012)

1/11/13: I added two chemical stocks to my shopping list: Sigma-Aldrich (SIAL) and FMC (FMC). I reported on SIAL on 12/12/12, so no need to discuss it again. FMC is also a repeat from 6/12/12. Earnings are due 2/6. Insiders are selling, which is never a good sign. Two of three rating agencies (Credit Suisse and Jaywalk) like the stock, S&P says hold.

1/6/13: Housing stocks are ranked 2 out of the 54 industries I follow (1 is best) for relative strength (not Wilder RSI). Few are worth buying because they have made a move and there's no technical reason to buy them. So iShares Dow Jones US Home Construction(ITB)ETF is good to buy the group. It's breaking out of a consolidation head-and-shoulders bottom. I'm going to wait for a throwback since prior congestion breakouts/gaps showed a retrace to the bottom of the gap. Long term hold to 32. The other pick is a risky play: Standard Pacific (SPF). This has broken out of a not-so-flat base since 2008. Resistance at 10 then 20. S&P says sell. Credit Suisse says outperform as of Nov. Earnings are due Jan 31, so I'll wait to see how the company performs. This is another long term hold, but as I said, it's a risky play. It hasn't moved like the others. It's a breakout from a consolidation head-and-shoulders bottom, too.

1/2/12: Since I can't find any stocks worth buying, I decided to add ETFs on the indices. I might as well park some money there. Powershares QQQ (QQQ) and SPDR S&P 500 (SPY).

12/20/12: BTH: After I posted the below comment, I looked at the stock again and decided that the stock had no reason to go higher. So I won't be buying it. It might recover or it might not. I have noticed that the stock made another big drop. I would avoid it.

12/13/12: I added Blyth (BTH) because of the big drop. Such large drops tend to see a nice recovery in the coming months. I don't particularly like the company business nor its fundamentals, but this might be a decent recovery play. I'm looking for the stock to make a double bottom, but we could have already seen the low (meaning a V-shaped recovery). Be careful because this is bottom fishing and you could get pulled into the water and drown as the stock sinks.

12/12/12: I added a bunch of stocks to my shopping list and I intend to buy some of these in the coming days. Insteel Industries (IIIN). On the weekly chart, it shows a symmetrical triangle starting from April 2011. Target would be $16 (then 20 and 23) from current 12. Texas Industries (TXI) is one of my favorite picks. It's at overhead resistance on the weekly scale, from mid 2009. Target: 68 from 47. Vulcan Materials (VMC) short term has broken out of consolidation from Sept. I'd wait for a retrace to 50. Target: 66 then 80. Mosaic (MOS) is predicted to have a difficult year in 2013 according to one research report but it's showing a head-and-shoulders bottom on weekly scale, from 12/2011 (left shoulder low). If it confirms, it could move up to 74 from 56. 12/18/12: Reports say that the price of potash is declining and some producers are closing mines. That does not bode well for the company.Sigma-Aldrich (SIAL) is near the top of a loose congestion region starting from 3/2012. This would be a upward momentum play. Emerson Electric (EMR) shows the same pattern from 11/2011. Target 58 from 51. Yawn.

11/16/12: I added UIL Holdings (UIL). This is an electric utility paying over a 5% dividend. They missed their revs in the most recent quarter (Nov 5) and the stock has been dropping. That presents a buying opportunity for those with extra cash sitting on the sidelines like me. The payout ratio is high, well above the 70% I like to see, but that fluctuates from year to year as earnings change. There is a risk that they could cut the dividend. Any bills for Sandy damage should be passed on to customers over time.

11/12/12: I added SodaStream International (SODA) to my list. I think the stock is fairly valued now ($36) but if it drops to about $30, then it's a buy. When it rises into the $40s, it's a sale. Sales are growing big time, so this range may curve upward over time. However, as good as the fundamentals are, the stock has moved sideways since Aug 2011, so that's puzzling. It also looks like a flat base, building support for a strong move up. Something is holding the stock down, so I would find out what that is before investing. The company is based in Israel, so maybe there is an international element involved.

10/18/12: I added Prana Biotech (PRAN) to my shopping list. It recently broke out of a flat base, so it's too expensive now (I expect price to drop because that's what has happened repeatedly in the past). The investment community is showing signs of recognizing the worth of their compounds in development for Huntington's disease, Alzheimer's, Parkinson's and brain cancer. This is early stage development (phase IIb for the most advanced). It's high risk, so keep any investment small and only for high net-worth individuals willing to lose all of their investment. If they announce favorable clinical trial results, sell immediately because the price will likely drop thereafter.

9/29/12: I looked at TEG on the weekly scale and it appears that the August bump is an anomaly and expecting a rise to occur is wishful thinking. I'm removing it from the buy list because I don't think it'll go anywhere.

9/27/12: I added FirstEnergy (FE) and Integrys Energy Group (TEG). These are two utility stocks under pressure (meaning they are tumbling). When they bottom, they could pay a tasty dividend plus have capital appreciation potential. However, there are reasons the stocks are dropping, so be sure you know what you're buying. These are not a buy now but maybe in the coming weeks they might be worth a small position. 12/17/12: addendum. FirstEnergy is overloaded with debt 139% of capital. Avoid. They may cut the dividend and even if they don't, they will have to play games by selling assets to make the coming debt payment.

6/16/12: I added Assurant (AIZ) and Mosaic (MOS). AIZ is at a measured move down resting on support, so I see a bounce coming. MOS shows a head-and-shoulders bottom confirmed on Friday. With food prices high, I think farmers will plant more, using more fertilizer. That's good for the company. Stock has been trending down since Jan 2011, so that's not good.

6/13/12: I added Balchem Corp (BCPC) mostly because I like the ascending triangle that appears starting from March/April coupled with a drop in stock price. I look for a recovery, so a nice move up. It's also related to the chemicals industry.

6/12/12: I added FMC (FMC) and Celanese (CE) to my shopping list. Basic chemicals as an industry have done well recently, so I went shopping and found these two. Insiders sold both in Feb and that's not good but the research reports I read were positive on the stocks going forward. I think FMC is a stronger play than CE. CE is trending down. When it bottoms out, it might be worth nibbling. FMC is moving horizontally after trending up. It's more of a momentum play while CE is a reversal play.

5/12/12: I removed CREE from the list after doing more research. It's been going down for 2 years now and there is a case to be made that it is near it's bottom, but I'm not interested in finding out when it continues to drop. Instead I added Exelon (EXC). This is an electric utility stock with a div of 5.4%. The stock has not gone anywhere because highly profitable contracts to provide electricity are expiring and being replaced with less profitable ones. Thus, earnings will be under pressure going forward. Supposedly, the recent merger should help with that. For a long term hold, you can make almost 5.5% waiting for this to move up, but there is downside risk.

5/11/2012: I added Cree Inc (CREE) to my shopping list. I have a lot of cash sitting on the sidelines and noticed an ascending triangle after a big dip (Dec 2011) in the stock. This could be a profitable play for the long term hold or even a decent swing play. It's a semiconductor stocks and I've not had too much luck with those. This has to break out of the congestion area formed during the past week or so, right at the breakout price of the triangle. If it can push above that area, then it could form a straight-line run. Otherwise, I would be cautious. I am going to wait for a clear direction (up) before I buy, if I buy.

-- Thomas Bulkowski

Copyright © 2008-2013 by Thomas N. Bulkowski. All rights reserved. Q: What is the difference between men and government bonds? A: Bonds mature.