` Gary Investing Blog: July 2012


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Monday, July 30, 2012

Four Stocks to Watch Next Week (DDD, SSYS, JPM, ARNA)

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 3D System Corp. (NYSE: DDD) is a provider for 3D content-to-print technology. The stock jumped almost 10%, made a new 52w high and closed very close to the high with a great volume on Friday. 50-Day MA has been a very good track of the stock prices since the bullish MA crossover in late Feb with very little breakout of the MA trendline. With the MACD just crossed to +ve area and Slow STO making higher highs and higher lows. I think DDD is a very hot stock to put on your radar. I think the long term trend is still intact and does not seem to reverse any time soon.

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J.P. Morgan Chase & Co. (NYSE: JPM)
The technicals for JPM can be bullish and bearish depends on how you are looking at it. Slow STO and MACD crossover shows bullish signs. The stock has gained in 5 trading days straight with decent volume. However, 50-day crossing 200-day MA from above is golden bearish and sell signal to many professional technicians. But the bright side is 50-day MA starts trending upwards, showing a round bottoming. Definitely put JPM on your radar next week. If the stock break through $37 (a round number resistance) with good volume, I would definitely add JPM in my portfolio with using % stop.

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Stratasys, Inc. (NASDAQ: SSYS) is a company doing similar 3D printing business as NYSE:DDD I mentioned above. MACD in positive level with bullish STO divergence. Similar to DDD, 50-day MA seems to show the price trend nicely and signal oversold area for SSYS. Both 50 and 200-day MA is trending upwards and although the stock has gained almost 9% on Friday, it still has a little bit trip to go until it reaches the upper band of the channel I have drawn. For comparison, SSYS has higher possible return for medium-to-short term trades (below 2-3 months holding). But DDD seems to be less volatile and suitable for longer term investment

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Arena Pharmaceuticals (NASDAQ: ARNA) has got the first anti-obesity drug approved by the FDA in the U.S. in late June. The stock has been very popular for speculative purpose before the approval. It keeps getting twitted and reported on WSJ. However, after the approval, the stocks has been going red. Although slow STO shows oversold signal and RSI might seem okay for a stock running up for so long, and $9.42 seems reasonable for a pullback, I think it is not suitable to add ARNA into your portfolio unless you have high risk tolerance. Recently, a anti-obesity drug offered by Cali-based Vivus has been approved by FDA. And based on several news reports I have read, the Arena drug appears to need a lot of supplements in order to have successful results. The drug itself is approved but not the procedure, etc. Correct me if I am wrong. But with vivus as a rival and unknown results and popularity of such drug, a pharmaceutical company based just on some ideas and single drug product should be avoided, especially for ARNA which has been such speculative in price movement.

The Good and Bad News of Last Week

The Good:

1) ECB chief Mario Draghi says willing to do whatever it takes and assures that it will be enough for saving the Euro.
2) Initial Jobless Claim declined 35,000 to 353,000.
3)Durable goods orders were up 1.6%
4) Earning reports have continued to beat expectations (except internet companies)
5) Zillow's home value index rose 0.2% compared with 2011 Q2
6) Michigan Sentiment for July was slightly increased to 72.3

The Bad:
1) 2012 Q2 GDP report, 1.5% annualized growth, continuing a weakening and sluggish pattern, although beating estimate. It is still a bad news.

Generally, I am bullish to the market now. In the future, I will provide more on the bad size.

Earning Reports this week: 
Facebook’s revenue growth shrank for at least the fifth consecutive quarter.
ZNGA down 37% as revenue growth slows and reported net loss, bringing questions on the sustainability of its business model.
Amazon reported a 97% drop in 2Q profit to $7 million although revenue rose 30%.

Thursday, July 19, 2012

July 19: JPM

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It has been a red day for JPM, down 1.4% and the gap after JPM Q2 financials announced has been filled, which is not a good sign in technically analysis. However, considering there is a short term uptrend following the bottom generated by London Whale trading loss and a neutral MACD and RSI, I don't think there is any rush in selling the stock now, unless it breaks or trend or below the recent $33.5 support. If you are not currently holding JPM, buying breakout at somewhere above $37 would be a safer play.

Okay. Here is the bad picture. 50MA crossed 200MA from above is a golden sell signal in double crossover method.

Disclaimer : This is not intended to be investment advisory, therefore, you should not make investment decisions solely on this blog's commentary without conducting your own due diligence.

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