Wealthbuilder.ie - Monthly Market Brief & Stock Pick

In our last communication in July to clients we pointed out that there was a possible significant bullish trend change approaching in the market. The key Dow Theory technical levels we identified were 4400 on the Transports and 10500 on the Industrials. As is by magic the market has remained “stuck” around these levels over the last 10 days. This “line” in market action is good because, as I never fail to mention to students, the longer such a line persists the more significant the potential market move on “breakout”. For momentum players my trade of preference remains the Direxion Emerging Markets ETF: “EDC”. My technical buy level last brief was a breakout from 24 dollars. So far it is up 25% which is excellent. It is hovering at nearly 30 dollars at the moment in sync with the market. It remains a hold until the market indicates otherwise.

On the value side there have been some excellent buys over the last few months: (MON, APA, AAP, BX, NE, DB, BTI, and my favourite TEF which bottomed at 54 dollars and is now at the 70 dollar level). Again they remain as buys until our technical signals says otherwise.

The charts below are courtesy of StockCharts.Com

Dow Industrials Index:

Dow Transports Index:

Telefonica:

Quarterly Market Brief & Stock Pick
In our last communication in July to clients we pointed out that there was a possible significant bullish trend change approaching in the market. The key Dow Theory technical levels we identified were 4400 on the Transports and 10500 on the Industrials. As is by magic the market has remained “stuck” around these levels over the last 10 days. This “line” in market action is good because, as I never fail to mention to students, the longer such a line persists the more significant the potential market move on “breakout”. For momentum players my trade of preference remains the Direxion Emerging Markets ETF: “EDC”. My technical buy level last brief was a breakout from 24 dollars. So far it is up 25% which is excellent. It is hovering at nearly 30 dollars at the moment in sync with the market. It remains a hold until the market indicates otherwise. On the value side there have been some excellent buys over the last few months: (MON, APA, AAP, BX, NE, DB, BTI, and my favourite TEF which bottomed at 54 dollars and is now at the 70 dollar level). Again they remain as buys until our technical signals says otherwise. The charts below are courtesy of StockCharts.Com Dow Industrials Index: Dow Transports Index: Telefonica: