Executive Newsletter North of the Blue
America's Stock Analysis System
April 12, 2010 |
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| Greetings! |  Some things should be repeated.
- Don't forget the Wednesday meeting for your "old times".
- We are now able to provide you with information on RED ZONE stocks as never before. Now you can see them when they enter the RED ZONE, while they are in the Zone and when they leave the Zone. Never before has anyone been able to pick up on stocks when they hit this critical buying period. To better understand the value of this we have segregated what we call our RUNNING RED ZONE stocks into their own selections. Now you can pinpoint where you are most comfortable selecting your own buy point. Click here to see our RUNNING RED ZONE listing or just scroll down this newsletter.
- For the first time we began using our INTEGRATION RULE. We discussed it at our last Wednesday meeting. We will work through it again at our next Wednesday get together. This is a chance for you to see what happens if you buy after someone else has used their money to prove that the stock has real value.
- Don't forget all that we bring you. At your fingertips you have information on the top 15 stocks world wide,just click here; the top ten U.S. sectors and the top stocks in each of these sectors, just click here;
- For our brand new RED RUNNERS listing click here.
Enjoy and let us know what your think. The best of all investing to you. Dick |
| What's New! |
 At our April 14 and 21 meetings we will go over a just move to production rule -- The Integration Rule. It is a six part rule that includes both buy and sell sides. We have had this in development and beta test for nearly two years. The response to the rule has been very positive. This led us to bring the rule out now.
We have also set up a new North of the Blue Red Runners Stock section. We are very proud of what we produce here and believe that you will find it is the fastest way to pinpoint new stocks as they meet our buy rules. |
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Indexes Year to Date | % Change Year-to-Date | Market |
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| 18.53% | North of the Blue Current Portfolio |
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| 8.15% | Nasdaq OTC Comp Index |
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| 7.76% | Amex Composite Index |
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| 7.11% | S & P 500 Index |
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| 5.46% | Dow Jones Industrials Index |
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| 5.46% | IBD New America Index |
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| 6.18% | N.Y.S.E Composite Index |
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| 7.15% | Gold Index |
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*For a detailed listing of the top stocks in each sector please go to the "List" section of our program. The first stocks will be those with the highest high last week. For example, the first 45 stocks in the "Retail" list is a listing of the stocks and their charts. After the "------" you will find those from the prior week and after the next "------" those from two weeks ago, etc. You get the picture.
Update 4/20/2010 | The Company you May Keep: Always investigate before you invest. Always check our chart. Does your stock meet one of our Buy Rules? Is the price up more than 5% from a defined Buy-Point for the rule you are using? Over 5% may be more risky. Fundamental research includes knowing annual and current earnings and sales increases, high return on equity, better profit margins, sponsorship, market in a confirmed upturn. When either a sector or the market overall are in a downturn you need to pay particular attention to your reasons for buying. What, for instance, convinces you that a particular stock can buck a broad trend?
A company's inclusion in one of our lists should not be viewed as a recommendation. Many are newer, smaller and highly volatile companies that require further research due to their speculative nature. Companies located outside the United States bring added risks because of the influence government policies may have on the company. Detailed research on your part is imperative. | |
Buy-Watch
North of the Blue's - Red Runners
April 20, 2010
| CAGC | China Agritech | Action: BW 4/20 at $19.80. |
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| REASONING: CAGC just bounced off the Blue Moving Average alter a very steep decent. The Channel shows a definite climb. But, both the High Price Strength and the Upward Price Strength have fallen severely with the Blue Line nearing 15% and the Black nearing 50%. This is not a good sign. With power dropping like this, the buy signals do not line up and we are in a definite wait and see situation. Monday is a Blue buying day but the last few days have been Red selling days. All in all, we need to watch this stock.4/20 the channel is breaking upward and the stochastic lines look like they will join. If they do, we have a winner. | | TNDM | Neutral Tandem, Inc. | Drop this one. |
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| REASONING: TNDM 4/11Move to Buy Watch NOW. Could be near term buy when it meets our Basic Rule. Also need to wait for the Power lines to join.4/20 Enough already. Off this one goes. | | PALM | Palm Inc. | B-W 4/20 close $4.91. |
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| REASONING: PALM 4/11 If you are of the Top Gun mentality and have the money to live through a potential loss, this one is a buy right now. For the rest of the world let's wait for the Power lines to join. 4/20 leave on Buy Watch. | | NTRI | Nutrisystems Inc. | B-W 4/20 close $19.38. |
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| REASONING: NTRI 4/11 Definitely meets our North of the Blue Basic Rule AND our North of the Blue Early Buy Rule. If you are of the Top Gun mentality and have the money to live through a potential loss, this one is a buy right now. For the rest of the world let's wait for the Power lines to join. 4/20 On 4/11 this went North of the Blue. Since then it has hovered just above the support line. If you bought this, it is a hold; if you are looking g at the stock today watch to see if it rebounds off of the support line. Finally we see the stochastic's rejoin. | | BWEN | Broadwind Energy Inc. | B-W 4/20 close at $4.13 |
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| REASONING: BWEN 4/11 Both Power lines falling below 15% and stock will enter Red Zone in a day or two.Put on Buy Watch until the stock is out of the Power Red Zone. 4/20 it is still running in the Red Zone. Watch. | | YTEC | Yucheng Tech Ltd BVI | B-W 4/20 $3.93 at close; |
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| REASONING: YTEC 4/11 Moved out of Red Zone and stock may cross the BMA WITHIN THE NEXT DAY OR TWO. If so, it would meet our NOTB Basic Rule. 4/20 confusion reigns. Leave this on the watch list for another week. | | CML | Compellent Tech | B-W 4/20 $13.12 | | REASONING: CML on 4/11 Power falling under 15% for both components. Just entering a Power Red Zone. Certainly a Buy Watch. 4/20 This continues to be a Red Runner. The stochastic's have split which is unfortunate. Keep a close eye on this stock to push through the 15% line. Also, if you are thinking of buying, click on the "News" button and look at the fundamentals. |
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Simple Buy-Watch
Non Red Runners
April 20, 2010
| Symbol | Company | Actions |
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| AMAT | Applied Materials Inc. | Action: BW 4/20 at $14.46 close. |
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| REASONING: AMAT has been on and off our lists for several weeks now. has finally fought its way through the thicket of Resistance Lines and has settled above the top line for two days in a row. One more day of watching should confirm whether this will still meet our tests for a buy. We also need to watch and see if the Upward Price Strength and High Price Strength remain over 85% .4/11 Stock has climbed out of the RED ZONE and past the BMA. But, it is still held up by the numerous Resistance Lines. 4/20 AMAT jumped through the Resistance Lines last week. Unfortunately we did not catch this as it went through. It was a god buy last week. As of now it has moved into the 85% zone and it is too early to use the Integration | |
APOL | Apollo Group, Inc. | Action: BW: 4/20 close at $64.87. |
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| REASONING: ABT fell sharply and today rebounded up from our Blue Moving Average. However, rather than going back up, it hit a Machine Generated Resistance Line. We need to wait and see how it resolves itself here. We also need to see what happens with the Upward Price and High Price Strength lines. They separated and the High Price Strength looks to be leveling off at about 50% while the Upward Price Strength appears to be leveling in the 60% area. This stock does not meet our tests now but will if the Strength lines turn and begin to climb. On 3/30 we thought it might have turned the corner but it had not. Within a day (before we could buy) the stock had turned down and so remains a Buy Watch. 4/20 still bouncing but looks like it may be building strength to break through the Resistance Lines. | |
APOL | Apollo Group, Inc. | Action: BW: 4/5 at $61.50 (open price) |
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| REASONING: ABT fell sharply and today rebounded up from our Blue Moving Average. However, rather than going back up, it hit a Machine Generated Resistance Line. We need to wait and see how it resolves itself here. We also need to see what happens with the Upward Price and High Price Strength lines. They separated and the High Price Strength looks to be leveling off at about 50% while the Upward Price Strength appears to be leveling in the 60% area. This stock does not meet our tests now but will if the Strength lines turn and begin to climb. On 3/30 we thought it might have turned the corner but it had not. Within a day (before we could buy) the stock had turned down and so remains a Buy Watch. 4/11 still waiting for APOL to clear the thicket of Resistance Lines. | | |
Also check "DickPicks" in your "DicksPicks"List of our program and NOTB-BUY-WATCH list. | | |
Ryan's Notes Week April 20, 2010
| Symbol | Company | Actions |
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PWRD | Perfect World Company | Action: Buy: 4/20 |
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| REASONING: Buy:Last week Ryan sent out a notice on this Red Runner. Since then we have seen two buy days with an initial push out of the red zone. Take note in late February that it tried to make the same push but failed to make it to the 50% line. For risk takers this is a buy in Ryan's book. It follows the correct Stochastic Rules. But watch it closely and set a stop. | | HQS | HQ Sustainable Maritime Industries | Action: Watch 4/20 at close of $6.08. |
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| REASONING: Buy-Watch as this is still a Red Runner. There has been some great blue buying days but the stock will not budge above the $6.00 level. | |
CTEL | City Telecom | Action: Buy/Watch:: 4/20 close at $14.79 |
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| REASONING: Basic Rule would apply here as the stock bounced off the BMA. | |
ABT | Abbott Labs; | Action: Buy/Watch:: 4/20 close at $53.06 |
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| REASONING: 4/20 A very neat Stochastic W and two stochastic's paired and moving up. For you Top Guns, you may wan to join Ryan and think about a buy. | |
WX | WUXI Pharmatech | Action: Buy/Watch:: 4/20 close at $16.86 |
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| REASONING: 4/20 "I bought this stock at $15.11 at the close of March 23 because of a Stochastic W that formed. It met resistance at 15.60 and created a new support line at 15.40. WX bounced back and forth daily between 15.40 and 16.00. I thought to myself: "Great here is a pattern within the NOTB system. I can make some money here. I planned on selling it at the high one day so I set a sell price at $16.15. I then planned to buy back at the low, which I set for $15.40. I was thinking that with a thousand shares I would make a really nice daily profit" It just happens that I sold WX yesterday morning while I slept soundly. I woke up to WX making a move upward. It did the same thing today. I will say this: "I made a nice profit in WX, but I could have done better if I had just stuck to the NOTB sell rules." I'm now waiting for the stock to come back in to buying range. Ryan Butcher. |
Also check "RyansPicks" in your "RyansPicks"List in our program and NOTB-BUY-WATCH list. | | |
Buy
April 20, 2010
| Symbol | Company | Actions |
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PWRD | Perfect World Company | Action Buy: 4/20 close at $35.92 |
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REASONING: 4/20 Last week Ryan sent a notice on this Red Runner. Since then we've seen two buy days with an initial push out of the Red Zone. Take note in late February PWRD tried to make the ;same push but failed to make it over the 50% line. For risk takers this is a buy. In Ryan's book it is a definite buy because it follows the Stochastic Rules. Watch closely if you buy and have your stop set. | |
GCI | Gannett Inc. | Action: BW: 31/2/10 at $15.95; 3/9 16.00 gain 3.1%. 3/18 $16.84 hold gain 5.58% 3/23 16.80 gain 5.3% in 2 weeks; 4/6 $17.54 gain 10.59%; 4/9 close at $17.79. Hold, up 11.54% in five weeks. Annualized = 120%. |
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| REASONING: GCI broke through our BMA* on March 1 at $15.22. If the Upward Price and High Price Strength lines join and continue to 85% this could be a winner. In fact, three are a number of very good reasons to buy now. It looks like it is resuming the trend which started in July of 2009. 4/6/10 Good trend. Hold. |
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Interest Placements for Uninvested Dollars for the Week April 20, 2010
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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 |
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| 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.) | |
SHY | iShares TR Lehman 1 - 3 Year Treasury Bonds | Action: Buy: 1/22/10 at $83.52; HOLD 2/23; 3/9 |
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| 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.) |
Also check "DickPicks" in your "DicksPicks"List in our program and NOTB-BUY-WATCH list. | | |
Current Portfolio Holdings
April 20, 2010
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CSCO | Cisco Systems | Action Buy: 2/1 at open $22.65; hold with stops; 2/23 sold at $24.20 gain 6.84%. This may be eligible for another buy.3/2 buy 3/2 $24.66. Gain 6.83%. 3/18 HOLD at $26.42 with a gain of 16.64%. 3/23 26.75 gain 18.1% 4/6/ high $26.38 gain 16.46%; 4/9 $26.60 at close. HOLD up 10.42% in nine weeks. Annualized = 100% 4/20 HOLD Close $27.18. Gain 11.63%. |
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| 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. Stock climbed back through the BMA and ma be in line for another buy. Cicso went back through the Blue Moving Average. Trend still good. 4/6 hold. 4/20 Continues to hold high. | |
INTC | Intel CP | Action:: BW: 2/7; buy 3/2 $21.00; 3.9 21.20 hold gain 1%; 3/18 HOLD with a gain of 6.14%. 3/23 22.75 gain 8.33%; 4/6/10 high $22.48 gain 7.05% hold; HOLD 4/9 at $22.55 close. Gain 7.38% in 5 weeks. Annualized = 47.97% annualized. 4/20 close $ 24.12 up 14.86% |
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| 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. 3/2 If you have any money left after buying the gold stocks look hard at Intel. I think it is poised to generate another trend line like the one we saw from July through November. Hold for very good trend. Also look at significant growth in silicon wafer sector. 4/20 hold and enjoy the ride. | | MRVL | Marvell Technology Group | Action: B-W 3/29 $20.16; 3/6 high $21 gain 4.96% in 1 week; 4/9 hold at close of $20.97. Gain 4.02% in two weeks. Annualized = 104.52%. 4/20 close at $21.84; gain 8.39%. |
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| REASONING: MRVL is ratcheting up its price every day. There are no giant leaps, but each day brings another step back and then up again. Fortunately the ups are greater than the downs and the trend line has begun to swing up. Another day or two should make this a solid buy. 4/20 Ryan says to watch this closely. We may sell soon as the stochastic's are dropping. Stop set. | |
NEWP | Newport CP | Action: Buy at $8.67; 2/23 hold 3/9 11.41 hold gain 31.60%; 3/18 HOLD with a gain of 38.29%. 3/23 11.94 gain 37.71%; 4/6 $13.13 gain 51.444% one month hold; 4/9 HOLD closed at $13. Gain 49.94% in four weeks. . Annualized = 649% 4/20 close at $13.68 gain 57.79%. |
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| 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*. Strong upward trend, hold. 5/20 watch carefully as stochastic's are going down. We may take our large profit and call it good on the 21st. | | TLAB | Tellabs, Inc. | Action: Bought 2/16/10 at open at $6.70; 3/2 $7.16 gain 6.87%; 3/9 7.45 gain 11.19% ; 3/18 HOLD with a gain of 17.13%. 3/23 7.66 gain 14.32%; 4/6 high $8.00 gain 19.42% hold; 4/9/ hold at $7.90 close. Gain 17.91% in eight weeks. Annualized = 116.41% 4/20 close at $8.47 gain 26.42% |
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| I bought TLAB a little late but believe I can still participate in the growth based on its well established trend line. 4/6 hold as the trend line strengthens. 4/20 doing well but watch the stochastic's. May sell to protect gain on Wednesday or Thursday. | |
| Average Gain for this Portfolio |
18.53% | |
| Average hold time for this Portfolio |
6 weeks | |
| Annualized Gain for this Portfolio |
160.59% |
| | Cash in the Bank Portfolio | |
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| Rules |
North of the Blue Stock Charts and Buy/Sell Rules
... Building-Block Strategy
... NOTB is simple, unique and driving gains out of this world
Click on "Master NOTB Chart" below. It links to a summary of North of the Blue's Chart outline. All charts use the same basic structure
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, proprietary algorithms, charts and rules. Our algorithms and insights allows North of the Blue to give you 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.
To work with North of the Blue you need to be kept current with our thinking. So, we keep you advised of our progress either in these weekly newsletters or by Twitter. In depth analysis can be found on our web site. On our web site you will see an example of how we used our basic rule and our building blocks for one stock in 2009 that led to gains ranging from 76% to 214%.Click here to see the how this happened.
Adding a rule, The Channel Rule. Click here for a well written explanation.
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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| How to Find Us |
Telephones:
General Office: (503) 233-9452
Support: (503) 446-9390
Address, meetings by appointment:
11000 SW Barbur Blvd, Ste 100
Portland, Oregon 97219
Mail:
North of the Blue
P.O. Box 569
Lake Oswego, Oregon 97034
North of the Blue is a dba owned by Custom Computer Programming, LLC. Billings for North of the Blue come from Custom Computer Programming, LLC | |
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Remember to join us for a detailed view of our latest rule, The Integration Rule, where you let someone else spend the dollars proving that the stock is a good buy and you join to collect some cash. Almost too good to be true. But, it does not cost you a penny to find out.
Sincerely,
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Richard Brenneke
North of the Blue, America's Stock Analysis System
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