SelfInvestors Leading Breakouts Soar to New Heights, But.. I'm Still Cautious

Over the past couple weeks, particularly in the past few days, several of the SelfInvestors.com highest rated breakout stocks have been soaring to new highs with outstanding volume as new leaders emerge.  As the market meanders higher with less than inspiring volume, some individual stocks are making explosive moves.  Highly rated companies such as US Global Investors (GROW), Silver Wheaton (SLW), NewMarket Corp (NEU), Copa Holdings (CPA) and Bolt Technology (BTJ) all made new all time highs today with very good volume.  Here's a look at the charts of these companies...

As always, you can view the list of top breakouts (these are stocks ranked 50/60 or above and have already broken out) here.

 

--------------------------------

As much as I'd like to highlight all of these top rated breakout opportunities BEFORE they happen, the advertising here pays very little and doesn't compensate for the full time job of researching, analysing, ranking and maintaining my database of stocks.  Not to mention it wouldn't be fair to my paying members.  How about giving the SelfInvestors.com premium service a try for free for 30 days?  I guarantee you won't be disappointed.

-------------------------------

Despite the successful breakout of some of my highest rated stocks, I still maintain an increasingly cautious approach as the major indices march towards major resistance levels with very little wind in their sails. 

In my weekend report to registered members, I mentioned the following:

With economic data of last week showing signs of a soft landing, the market continued to march higher, albeit in unmeaniful holiday trading.  With trading volume levels returning to normal levels later this week, we should begin to see signs of the market showing its hand.  I continue to believe that the market has come too far, too fast, with little institutional support behind the move in the past couple months.  With resistance at multi year highs in both the S&P (1326.70) and Dow (11670.19) as well as the 200 day moving average for the Nasdaq (about 2230) on the horizon, it's important to proceed with caution on the long side.  There is some room to run to the upside before meeting those levels, but once those levels are reached I'll be playing the market as if that is the end of road.  Essentially, I'm forcing the market to prove me wrong by breaking out to new multi year highs in the Dow and S&P and above the 200 day moving average for the Nasdaq WITH BIG VOLUME.  Only then will I get aggressive on the long side.

Here's a look at the charts of the major indices.  If we get a few more moves up to resistance with lackluster volume, you better believe i'm increasing my short allocation big time.

You see the Dow marching toward its multi year highs of last May.  The fairly steep incline and lack of volume (whether its typical of this time of year or not) are a concern as it approaches this formiddable resistance level.  Be careful up here and consider locking in some of those profits soon.

Similar scenario for the S&P500.  At the very least, it needs to come in a bit and retest that steep trend line.

The Nasdaq isn't close to resistance of multi year highs, but it is close to strong resistance of the 200 day moving average.. an area where it retreated from back in June.