Greetings!
I do believe that we are working with a difficult and very unusual market. Gold is an excellent example. Ordinarily, we would have seen it turn up by now. It did turn up but only very briefly -- as is a day or two.
I want to look at several stocks before taking a buy or sell position on them.
This is the kind of market in which North of the Blue will shine. Look at the "Expectations" note below.
Please take a look at how we are doing below. Overall we are doing well. We had 13 sales with three losses and 8 winners. That's a 63% accuracy which is not bad in this market. Our overall average is nearly three times that of the major indexes.
Dick Brenneke
February 23, 2010
503-233-9452 or 503-926-7567
Portland, Oregon 97202
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| How are we Doing? Is there really any doubt?
... Where the real profit is |
January
| North of the Blue |
gain +12.5% |
| Dow Jones Industrial Average |
loss -(3.26)% |
| S&P: |
loss -(3.46)% |
| NASDQ |
loss - (4.27)% |
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| North of the Blue 25 sales; 21 gains 4 losses |
Accuracy 84% | |
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Look at What Members Have at Their Fingertips.
Here is the detail regarding our Change List, Buy Watch List, Current Portfolio Holdings and our Cash in the Bank Portfolio Listing. In addition, you can see how we have done in relation to the major indices just click here.
As some of you saw this week, we had a server down on Tuesday morning the 23rd. We apologize but cannot control times when servers have to be taken off line for service. In this case, we knew that it would be down but did not understand the urgency of taking if down during the day. We are told that this will not happen again or, if at all possible, our hosting company will move us to another server overnight. Since we had no notice of the problem with this server today we were not able to warn you in advance. I apologize for that.
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Expectations
I think that it is important to restate who we are and what we do. North of the Blue is not only the best stock analysis to be found, it is America's Stock Analysis System. Now the legal stuff. Does every stock we pick make money in the first 30 days it is held? No. Our rules tell us the time to buy and the time to sell stocks.
We provide, in our Buy Watch list, stocks that should be on your and our radar screens. We will not buy each of them. Indeed you have seen us discard several when it became apparent that they would not meet our buy rules in the foreseeable future.
When we put a stock into our North of the Blue Portfolio, we expect that the stock will gain within a reasonable amount of time. We cannot predefine "reasonable". If you look at our stocks from last year you will see that we held stocks for as brief a period as two days and as long as six months.
We have made a mistake, I think, in putting our Power W or Stochastic W front and center. We cannot say that such a picture will always gain in the short term. We see it gaining but cannot define how long that will take. What one can see is the angle at which our Buy Watch or Upward Price Strength climbs. The faster the climb the sooner the price gain. What counts is whether or not the gain continues.
In future newsletters I want to talk further about what we can provide and what you expect of us.
We also need to discuss accuracy, among other things. |
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Educational Meetings
... seminars and one-on-one
Monday, February 1, we held our first seminar for North of the Blue paid subscribers and trial subscribers. We had 13 people present which was just about what we wanted. According to everyone the meeting was an unqualified success. Now we are averaging 15 people and that seems to be a very manageable number.
We have gone from one hour to one and one-half hour. So far that feels just right.
These scheduled seminars are held every Wednesday evening from 7:00PM to 8:30PM at 11000 SW Barbur Blvd, Ste 101, Portland 97219. Right now we are scheduled through the end of March. There is still room but don't wait too long. We have scheduled these meetings through February and March. Please call or email in advance to reserve your place. We want to avoid a lecture hall scenario. These seminars need to be smaller so that participants can network and work with each other to find solutions. If you have been coming to the seminars, just let us know if you cannot attend so that we can give your spot to another. If you were at the last meeting we assume you will come to the next one unless we hear otherwise.
We also have scheduled meetings during the week. Unfortunately, we cannot accommodate "Drop Ins". If you would like to meet with us on a one on one basis during the day please let us know in advance so that we can find a time that works for you and for us. These slots are beginning to fill so let us know as soon as you can. There is a $25.00 charge per person for these meetings. Unlike the seminars, these meetings are designed to address your questions only. We want to see you use this to cut your learning curve down. Using our tutorials we want to see you making money with our system before the end of your two week trial period. If you are making money, we feel you will be all the more inclined to stay.
Yes, you will have plenty of time to ask your questions in either venue. The goal of these meetings and on our one-on-one daytime meetings is to get you up to the point where you can make prudent, profitable choices based on a thorough understanding of our very simple charts and rules.
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North of the Blue Stock Charts
... simple, unique and driving gains out of this world
Here is a summary of a North of the Blue Chart. All use the same basic structure. Please click on "Chart Image" below to see a comprehensive explanation of North of the Blue Stock Charts.
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North of the Blue Buy/Sell Rules
... Building Block Strategy
North of the Blue is not built on magic dust, mirrors or slight of hand. It is built on one simple rule that allows an investor to control his or her own destiny. It is based on investments in solid stocks and analysis using our easy to understand charts and rules. Our algorithms and insights make North of the Blue a unique approach to making money in the stock market. |
| North of the Blue does not depend on bells, whistles, arrows all over the chart and rulers that you put over a graph. Instead it builds on a single, very simple rule, to generate unbelievable profits. "Unbelievable" that is until you put the money into your bank account.
Here are our basic rules. We suggest that you clip these and keep them by your computer until they become second nature.
North of the Blue Basic Rule (NOTB BASIC RULE): A stock should be bought when its price is increasing up through our Blue Moving Average (BMA) and sold when its price is declining through our BMA.
But using the BASIC RULE leaves a considerable amount of money on the table. We do not capture this money because we wait for the sell half of the BASIC RULE to complete.
In order to recoup more of the gain without adding any risk we modify our BASIC RULE by adding to it our EARLY SELL RULE. The Early Sell Rule states that a stock should be sold when its High Price Strength and Upward Price Strength drop below 85%. We usually incorporate this as a confirming or auxiliary rule. Here's the complete rule:
North of the Blue Basic Rule with Early Sell: A stock should be bought when its price is increasing up through our Blue Moving Average (BMA) and sold (a) when its price is declining through our BMA OR (b) when its High Price Strength and Upward Price Strength drop below 85% on our green stochastic panel, whichever comes first.
In order to capture price gains before the stock price reaches the North of the Blue Moving Average we introduce a final modification of our BASIC RULE. The rule now provides more accurate (and more risky) early buying as well as early selling. Here's the complete rule:
North of the Blue Basic Rule with Early Buy and Early Sell: A stock should be bought (a) when its price is increasing up through our Blue Moving Average (BMA) OR (b) when its High Price Strength and Upward Price Strength join or nearly join and leave a severely oversold Red Zone, turn sharply up and climb through 50% and it should be sold when its High Price Strength and Upward Price Strength drop below 85%.
Another rule is based solely on the behavior of our Upward Price and High Price Strength for any given stock. This rule, called our STOCHASTIC "W" or POWER "W". It is a stand alone rule that does not depend on our Basic Rule. Here it is:
Stochastic "W" or Power "W": A stock can be safely bought when its Upward Price Strength and High Price Strength join and form a clearly identified "W" under our 15% Stochastic or Price Strength Line. The stock can be bought before the last part of the "W" climbs over 15%. To maximize profit the stock should be bought before the upward Price Strength line reaches 50%.
There is one more stand alone rule that does not depend upon our Basic Rule. As you might expect when programmers and other technocrats get together to codify their rules for technical stock analysis, at least one rule will be based on how computers are used or programmed. Don't be disappointed because we left this until last. The rule is our MACHINE TRADING RULE. Here is the rule in a nutshell.
MACHINE TRADING RULE: A stock may be safely bought when it passes through one of our green, horizontal lines going up (Resistance Lines) OR when it rebounds up from one of these lines (Support Lines). The Machine Trading name comes from the points at which institutional investors have their computers set to buy and sell. If you look at how prices behave around these points you will see that these are the points that major market drivers come into play. More on this in a later newsletter.
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Changes
... buys, sells and moves to Buy-Watch since our February 16, 2010 Executive Newsletter.
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Change List February 23, 2010
*BMA = Blue Moving Average
| Symbol |
Stock |
Actions |
| REASONING: What rules were applied, why and when. |
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BBNK |
Bridge Capital Holdings |
Action: Buy: 1/29/10 at $6.79; 2/16 hold still well North of the Blue;2/23 sell at $8.05; gain 25.62% |
| REASONING: Used Basic Rule. Stock crossed the BMA* on 1/29/10. Both the Upward Price and High Price Strength lines joined as the climbed from the 50% stochastic area and went through the 85% line on 1/29. I waited until later in the day to make sure the stock climbed through the strong Resistance Lines. Note the solid buy volume on the two preceding days. |
| BRCM |
Broadcom CP CLA One of the prime movers for BDH. |
Action: Bought 2/12/10 at $30.30; sell 2/23 at $31.00 Gain 1% in 2 days. |
| REASONING: The stock blew through the BMA* at the speed of light. Absolutely no hesitation. I'm watching this carefully because it has a history of small gains. Stock rolled over and stochastics dropped below the 85% line. |
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CAAS |
China Automotive Systems |
Action: Bought 2/16/10 at $17.00; 2/23 up 8.2%. Hold but consider a stop. |
| A perfect Stochastic-W formed last week. Bryan Butcher found this one. Kudos Bryan. Well worth a buy this Tuesday. I would suggest caution since the "W" appears to be flattening out. However, buying is still very good and the price is still rising. Stochastic looks like it will continue to climb. |
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CSCO |
Cisco Systems |
Action Buy: 2/1 at open $22.65; hold with stops; 2/23 sell at $24.20 gain 6.84% |
| REASONING: Cisco has been one of the most active stocks on the NASDAQ Exchange over the past ten days. It moved out of the Red Zone while forming a near perfect "W". I say "near perfect". It is a good sign although it could be better. But, the High Price Strength and Upward Price Strength joined an dare now climbing in lockstep. This stock is poised to go North of the Blue with real strength. We are looking at a serious buy in the next day or so. |
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CYD |
China Yuchai International Limited |
Action:Should have been bought 2/8 at $12.50 and sold 2/19 at 14.10. Gain 12.8% |
| A perfect Stochastic-W formed last week. Bryan Butcher found this one. Nice going Bryan. Well worth a buy this Tuesday. I would suggest caution since the "W" appears to be flattening out. However, buying is still very good and the price is still rising. Sell because the stochastic W did not continue as predicted. Here is a case where the timing of the buy is very important. The longer one waited the further the stock moved from a true Stochastic W. It cleared the 15% line on February 9 going up. That was the buy signal. |
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HMIN |
Home Inns Hotels Management |
Action: Bought 2/16/10 at open $31.61; 2/23 hold stock just coming North of the Blue |
| A perfect Stochastic-W formed last week. Bryan Butcher found this one. It looks like Ryan pulled off the "hat trick". Very nice going. |
| MOT |
Motorola, Inc. |
Action: Bought 2/16/10 at open at $7.29; Sell 2/23 at 6.85 down 6.03% |
| Motorola formed a nearly perfect Stochastic-W last week. That ant the fact that it is a driver in the Broadband ETF make it an Early Buy in my book. |
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NWSA |
News Corporation CLA |
Action: Buy 2/1 with WEAK STOCHASTIC "W" at $12.41; 2/7 hold to see if it breaks through the Resistance Line. 2/23 sell at $13.60gain 10.48% in 3 weeks. |
| REASONING: News Corporation could buck the industry trend by posting real profits. Moreover, we see a solid Stochastic "W" that formed over the past few days. The buy high price average looks like a rocket poised for lunar lift off. It is easy to see this coming out of the Red Jail Bars and climbing north of our BMA*. Watch this one closely. 2/1 buy. 2/7 Stochastic W did not hold; fell below BMA*; hold for trend line to continue. |
| TLAB |
Tellabs, Inc. |
Action: Bought 2/16/10 at open at $6.74; put a stop on this one. HOLD WITH CLOSE STOP. |
| I bought TLAB a little late but believe I can still participate in the growth based on its well established trend line. | |
Buy-Watch List February 23, 2010
| Symbol |
Company |
Actions |
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ABX |
Barrick Gold |
Action: BW: 1/23/10 |
| REASONING: Watch for rebound off of Support Level. |
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APOL |
Apollo Group Inc. CL A |
Action: BW:1/23/10 |
| REASONING: Watch for rebound off of Support Level |
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GG |
Goldcorp Inc New |
Action: BW: 1/23/10 |
| REASONING: Watch for rebound off of Support Level. Price touched the BMA*. Good rebound. Watch to see if the Upward Price Strength and High Price Strength both point up in the next day or so. |
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GLD |
SPDR Gold Trust |
Action: BW: 1/23/10 |
| REASONING: Watch for rebound off of Support Level |
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GOLD |
Rangold Resources Ltd. |
Action: BW: 1/23/10 |
| REASONING: Watch for rebound off of Support Level. Price touched the BMA*. Good rebound. Watch to see if the Upward Price Strength and High Price Strength both point up in the next day or so. |
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INTC |
Intel CP |
Action:: BW: 2/7 |
| REASONING: Intel is beginning to show serious strength. It broke through our Red Zone with ease and is now beginning to climb toward 50%. We will have to wait until the Strength lines join and the price to work its way through the numerous Resistance Lines between the current price and our BMA*. Keep this one on your radar screen. Everything I see and read tells me that silicon chip makers (That's what they make computer chips out of.) are very, very busy. |
| REASONING: News Corporation could buck the industry trend by posting real profits. Moreover, we see a solid Stochastic "W" that formed over the past few days. The buy high price average looks like a rocket poised for lunar lift off. It is easy to see this coming out of the Red Jail Bars and climbing north of our BMA*. Watch this one closely. |
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VPRT |
VistaPrint NV Ord The Netherlands |
Action BW:1/23/10 |
| REASONING: Stock failed to cross BMA; Stochastics fell off sharply. |
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Also check "DickPicks" in your "DicksPicks"List in our program and NOTB-BUY-WATCH list. |
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| Current Portfolio Holdings
February 23, 2010 |
| Symbol |
Company |
Actions |
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COHR |
Coherent, Inc. |
Action Buy: 2/1/10 at $29.66; 2/16 hold still well North of the Blue;2/23 hold |
| REASONING: Used Basic Rule. Stock crossed the BMA* on 1/29/10. We could have bought at that point. However, I waited until the Upward Price and High Price Strength lines joined, left the stochastic Red Zone and climbed through the 85% line. This could have been bought on !/30 but I decided to wait and see if the Upward and High Price Strength lines would settle above 85%. |
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HMIN |
Home Inns Hotels Management |
Action: Bought 2/16/10 at open $31.61; hold 2/23 |
| A perfect Stochastic-W formed last week. Bryan Butcher found this one. It looks like Ryan pulled off the "hat trick". Very nice going. |
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IEF |
- iShares TR; Lehman 7 - 10 year Treasury Bonds |
Action: Buy: 1/22/10 at $90.46; watch for break through Resistance Level. Hold 2/23 |
| REASONING: Buy:Basic Rule with Early Buy. Stock moved rapidly out of Stochastic Red Zone then jumped very quickly tot 50%. Not surprising since bonds are a traditional hedge in troubled times such as we have now. Here you get the equity gain as well as the interest But watch to see if Strength lines continue to climb. Upward Price Strength is lagging. (Note: interest is paid if you hold the bond for at least one quarter.) |
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NEWP |
Newport CP |
Action: Buy at $8.67; 2/23 hold |
| REASONING: This stock has shown significant buying volume over the past week or so. Upward Price Strength and High Price Strength have joined forces and are continuing to climb. However, we need to see them pass the 85% marker before this becomes a serious contender. As you can see, the price line is poised to pass through our BMA*. 2/2 stock rebounded off Machine Generated Support Line; climbed through BMA*. |
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SHY |
iShares TR Lehman 1 - 3 Year Treasury Bonds |
Action: Buy: 1/22/10 at $83.52; HOLD 2/23 |
| REASONING: Buy:Basic Rule with Early Buy. Stock moved rapidly out of Stochastic Red Zone then jumped very quickly past 50%. Not surprising since bonds are a traditional hedge in troubled times such as we have now. Here you get the equity gain as well as the interest (Note: interest is paid if you hold the bond for at least one quarter.) |
| TLAB |
Tellabs, Inc. |
Action: Bought 2/16/10 at open at $6.70; |
| I boujght TLAB a little late but believe I can still participate in the growth based on its well established trend line. |
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TLT |
iShares TR Lehman 20+ Year Treasury Bonds |
Action: Buy:: 1/22/10 at $91.86 hold with close stop 2/23 |
| REASONING: Basic Rule with Early Buy. Stock moved rapidly out of Stochastic Red Zone then jumped very quickly tot 50%. Not surprising since bonds are a traditional hedge in troubled times such as we have now. Here you get the equity gain as well as the interest But watch to see if Strength lines continue to climb. (Note: interest is paid if you hold the bond for at least one quarter.) |
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Cash in the Bank Portfolio Summary
... Where the real profit is
At February 23, 2010 |
| North of the Blue, JANUARY |
1/31/2010 |
gain 12.50%* woth holdings |
1 month |
| Dow Jones Industrial Average |
1/31/2010 |
loss -3.26% |
1 month |
| S&P: |
1/31/2010 |
loss -3.46% |
1 month |
| NASDQ |
1/31/2010 |
loss -4.27% |
1 month |
| Stock |
Sell Date |
Gain / Loss |
Time Held |
| APA |
1/12/2010 |
+ 6.32% |
3 weeks |
| ATPC |
1/12/2010 |
+2.78% |
4 days |
| BBNK |
2/23/2010 |
+25.65% |
4 weeks |
| BDH |
2/05/2010 |
+14.55% |
3 weeks |
| BRCM |
2/23/2010 |
+ 1.55% |
3 weeks |
| BRY |
1/12/2010 |
- 3.55% |
3 weeks |
| CISG |
1/12/2010 |
- 6.95% |
1 week |
| CSCP |
2/23/2010 |
+6.84% |
2 weeks |
| CYD |
2/19/2010 |
+12.8% |
2 weeks |
| EDZ |
1/12/2010 |
+ 25.37% |
2 weeks |
| EEE |
1/12/2010 |
+ 63.83% |
3 weeks |
| HAL |
1/12/2010 |
+ 9.60% |
2 weeks |
| ISSI |
2/5/2010 |
+ 14.55% |
4 days |
| IYT |
1/12/2010 |
+ 14.35% |
2 months |
| KWK |
1/12/2010 |
+ 5.60% |
1 month |
| LL |
1/12/2010 |
+ 6.86% |
1 week |
| MOT |
1/12/2010 |
- 6.03% |
1 week |
| NWSA |
2/23/2010 |
+ 10.48% |
3 weeks |
| OIS |
1/12/2010 |
+ 9.53% |
3 weeks |
| OKSB |
2/12/2010 |
+5.30% |
2 weeks |
| OXY |
1/12/2010 |
+ 1.86% |
3 weeks |
| PL |
1/29/2010 |
- 2.72% |
5 weeks |
| VIP |
1/12/2010 |
+ 7.37% |
1 week |
| WRLS |
2/5/2010 |
+ 5.51% |
1 week | | |
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Sincerely,
Richard Brenneke
North of the Blue Stock Analysis System |
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| Read why then use your North of the Blue tools to check out our Buy-Watch list.
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| Featured Articles |
| Look at our Buy-Watch selections then follow them into our Current Portflio and our Cash in the Bank "Portfolio". The thinking behind our selections is in our Education section at our web site. | |
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