February 26, 2014 Leave a comment
After staying bullish for all of 2013, our late-December Market Comment said, “The New Year may bring a pullback.” Then in early January we forecast: “A significant correction is on the horizon.” In anticipation of a pullback we have closed a number of profitable positions.
Indeed, the anticipated pullback arrived in late-January and immediately sent the U.S. indices toward the 200-day moving averages. While others turned bearish, we viewed the pullback as a buying opportunity.
We added numerous positions such as Ballard Power (BLD-TO), Cequence Energy (CQE-T) or RF Micro Devices (RFMD-Q), among others. These stocks have already produced considerable gains for our subscribers: +35%, +12% and +21% as of today.
Also, our focus has shifted to the Toronto market – traditionally a late-stage performer. Many stocks in the Energy and Resource sectors – which we recently termed the “tail-end goodies” – are in basing formations (e.g., ECA) or have broken out (e.g., CNQ, HSE and CCO). Even the Golds may participate in, at the very least, a reflex rally as part of a larger base-building process. Some analysts are advocating selling Canadian and buying U.S. – our work suggests that the opposite strategy might lead to relative out-performance this year.
We have recently added numerous Energy, Resource and Gold stocks to our BUY list and we continue to add new positions. The current market still offers great buying opportunities; however, investors must be extremely selective. To view our most recent Market Comments, including New York and Toronto targets and the latest BUY lists, please visit www.na-marketletter.com