With institutional traders back at work after holidays, they began the new year with renewed buying

Past week recap:  With institutional traders back at work after holidays, they began the new year with renewed buying, driving the major market indexes up.  This is quite a departure from the beginning of last year when the markets nose-dived.  From a trading perspective this renewed buying is a bit surprising – and late – as stocks have already made significant moves upward and last week’s buys were too late to embellish institutional 2016 year-end reports.  This could be a sign that institutions are anticipating policies/legislation from a Republican-led White House and Congress that they expect will benefit earnings of U.S. corporations, but that is merely a guess.

Trading among our stocks picked up, with a mix of buys and sells.  Still holding a high number of double-digit gainers – both long and short – even after closing out a few this weekend.

Analytics update:  Much effort and time has been spent the past 8 weeks evaluating six different analytic variations, with the first five not proving more productive than the current version in use.  The sixth one, however, has proven more productive – with fewer trades as a bonus, proving the adage “if at first you don’t succeed, try, try again”.  Without going into mathematical details, extensive back-testing has confirmed this version will yield fewer trades, a higher percentage of profitable trades, and higher overall return by avoiding more of those short-term “blips” or false reversals that produce losses.  This version – Version 51 – is in place this weekend.  On a few stocks this new version suggests a stock trend direction opposite the prior version, in which case adjustments are incorporated in this weekend’s trades or as soon as price action justifies.  Overall, a good development for starting our 2017 trading.   

Highlights:  4 new weekly highs in long positions.  18 stocks with double-digit long gains:

       AHGP +16%     GRBK +14%      ATW +29%      NEFF +31%                              PIR +65%    PES +74%                

       BZN +13%        HUN +16%        ERF +20%                 

       CYBE +10%      KMT +10%        FLDM +23%                                       

       EVTC +13%      NGL +14%         TROX +27%        

       FRPT +13%      XNCR +11%       TRUE +28%

                          

1 new weekly low among short positions.  3 stocks with double-digit short gains:

      URBN +17%      NPTN +25%      AGEN +26%

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