Weekly Review for 5/11/2015

Geoff Bysshe | May 10, 2015

The QQQ’s slightly negative on the week, but managed to recover both the 50 DMA and 10 DMA after a strong Thursday and gap open Friday. A positive jobs report on Friday was the primary catalyst for the move up. The SPY, and DIA, have similar patterns, both sitting a little closer to their recent highs than the QQQs.  IWMrecovered the 10 DMA but is still below its 50 DMA.

The NASDAQ 100 All Stars model was up +0.88% on the week, this was a nice outperformance vs. the QQQ’s which closed down -0.33% on the week.

Big gains in EA, NXPI, and NFLX were partially offset by a large sell-off in MNSTpost-earnings. MNST, while beating nicely on revenue, missed on earnings and sold off back under its recent trading range.

It’s never fun to take a hit on an earnings report, but the models track record of performance in earnings reports is quite good. Earnings reports have made the model a lot more money than they have cost it. The way to proper trade through earnings is proper position sizing.

MNST is also the oldest trade in the portfolio dating back to November 2014 and only 50% of the position remains after reaching multiple profit targets. Its big sell off this week also illustrates the importance of using targets to “scale out” (take profits in stages) in a system that rides big trends as this model does.

EA also reported this week. EA had a positive report, gapping and running higher early in the session, but it closed well below its high of the day despite being able to hold onto its gains. It was important to note that the day EA was reacting to earnings the general market experienced a big down day.

In comparison to the negative general market, EA’s performance was outstanding, but to most traders this would not have looked obvious on the chart. As a result, it is not surprising that EA was up 2.7% yesterday while the market rallied 1%.

This pattern of hidden great relative performance on big down market days also occurred recently (4/30) in NXPI. The market was weak, the stock tried to rally big on earnings but was held back by the general market. Now, only 6 trading days later, the QQQ’s are about 1% higher than their 4/30 close, but NXPI is up over 8% in the same time!

For daily performance updates of the model positions and top 25 ranking stocks see the Model Portfolio section of the member area. If there are any changes to positions from stops or targets being reached, we’ll email you.

Below you’ll find your summary of weekly and longer-term performance with news highlights and price action analysis for each of the positions.

You’ll notice the weekly position summary tables include unique gauges. These gauges will give you a quick read on the strength of the stocks trend and how the trade is progressing. For more information on how to interpret and use these new gauges you can review two quick tutorials in the FAQ section of your member area here. You’ll also find the tutorials for the gauges in the “How to Use the Model” section of the member area





The Current Condition of the Model

The model beat out the benchmark this week by over 1%. We also weathered two earnings reports, one favorable for EA and the other, MNST, led to a Friday sell-off in that stock.

There are no additional earnings reports for our holdings until the end of May. All five of our holdings are above their respective entry prices and all five have a “hold” rating.

For more information about the current and closed positions go to the Model Portfolio section of your NASDAQ 100 All Stars member area.

For more information about the current and closed positions go to the Model Portfolio section of your NASDAQ 100 All Stars member area.

Best wishes for your trading,

James Kimball, Trader & Analyst