Keep an eye on the following stocks for potential breakouts using fundamental and technical analysis.  Because everyone’s risk tolerance is different – view these for educational purposes only and or paper trades.   The fundamentals were gathered from IBD (Investors Business Daily) and the technicals are mine.

As of this post-

MCD (McDonald’s) = RS (relative strength) is 94 and an EPS (earning per share) of 90 along w/ decent ROE (return on equity).  I like the chart if it breaks out above 64.  The model will not chase it past 67.  A stop would be placed 8% from entry or 55.44 if you are willing to risk more.  An individual stock trade does not amount to more than 10% of the M48 model.  This stock was mentioned on the Pro Investor Show a few weeks back.  Close on Friday was 60.59.

CMTL (Comtech Telecommunications Corp.) = RS is 96 and EPS is 91.  The M48 likes it on a break above 50.55 w/ a stop at 8% back from entry or 44.54 at the most.  Close on Friday was 48.95.

SXL (Sunoco Logistics Partners) = RS is 88 and EPS is 87.  Very thinly traded and not interested unless it breaks above 50 w/ a stop at 43.11.  Close on Friday was 43.79.

CVX (Chevron Corporation) = RS is 87 and the EPS is 92.  The M48 likes CVX w/ a close above 80 with a stop at 70.91 or even tighter at 73.60.  Close on Friday was 79.00.

The M48 has a 33% long position in the S&P.  This should be a key technical week which will determine if the model increases its percentage long from 33%.  I’ll let you know.  If and when we break 820 on the SPX (S&P cash) = all bets are off and we go back to cash.

Investing and trading with STOPS is a plan.  BUY & HOLD is not a plan unless the position(s) continue to trend in your direction at which time you would use trailing stops along w/  a profit taking strategy based on technicals.  So easy but so few have the time to acquire the discipline.  Hence, which is why clients/subscribers follow the M48 model which teaches discipline while implementing diversification along w/ market timing – which is a plan.

Videos coming soon.