7-12-16 Before the Open Comments

I wanted to update the long-term buying strategy that buys strong fundamental stocks that breakout of basing patterns with volume greater than 100% above 50-day average volume. I defined the six sell rules in a prior post; this is a synopsis:[LIST][*]#1 Sell any daily close below 5.5% below the pivot (cost).
#2 Sell any Friday close below the pivot.
#3 Sell the day before an earnings report unless you have at least 5% profit.
#4 After holding for eight weeks, sell at the Friday close if you don't have at least 8% profit.
#5 after holding at least nine weeks, sell at the Friday close if the price is below the 10-week moving average on above-average volume.
#6 After holding for 18 weeks or longer, sell any highest volume week whether the price is up or down.[/LIST]
The following spreadsheet view shows the above rules in action from the follow-through day we had on 2/17/16.

[ATTACH=CONFIG]36941[/ATTACH]

It should be clear that most of the breakouts have failed, mostly using sell rule #2 at a Friday close. However, the stocks that have worked have surpassed the small losses of the failed positions. Using $10,000 as the position size for each purchase, the net gain is about $16,000; this gain is unrealized. The current position gains range from 5.3% to 67%, and the longest held position was purchased 20-weeks ago.

The S&P500 made a new high, usually after the market corrects for a year or longer, this is positive. Breaking to a new high erases, at least for this index, the head and shoulders pattern. A cynic might see a double top. In this business, optimists usually make more money than pessimists.

Following up on comments made yesterday by Pascal, that European and Japanese NIRP is forcing institutional money to the US markets chasing yield; I decided to do a screen for liquid high yield opportunities. The following table is the result:

[ATTACH=CONFIG]36942[/ATTACH]

As you can see, there are opportunities with significant yield and some of these opportunities are showing bullish price gains on top of their dividend yield. Given the situation with central banks, these kinds of opportunities may have legs.

Watchlists were updated yesterday before the open. EBIX broke out yesterday. Even though I produce a short taking watch list, I have not taken a shorting posture, too much money inflow. Someday, I expect the central banks will destroy the insurance industry and pension plans producing a short taking opportunity.