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 DAILY AFTER-MARKET UPDATE
Tuesday, November 18, 2008 | 5:33PM

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Indices       NYSE       Nasdaq    
Dow +151.17 8,424.75 +1.83%   Volume 6,751,820,000 +22% Volume 2,442,180,500 +29%
Nasdaq +1.22 1,483.27 +0.08% Advancers  1,306 35% Advancers  1,163 39%
S&P 500 +8.37 859.12 +0.98% Decliners  2,325 62% Decliners  1,749 58%
Russ. 2000 -3.79 447.51 -0.84% 52 Wk Highs 8   52 Wk Highs 6  
S&P 600 -1.29 240.51 -0.53% 52 Wk Lows 654   52 Wk Lows 594  


 CLOSING  MARKET COMMENTARY  
Major Averages End With Gains After Late-Afternoon Rally - Adam Sarhan, Contributing Writer, www.CANSLIM.net

The major averages positively reversed on Tuesday, after the Russell 2000 Index first slid to a fresh 2008 low. Volume totals were reported higher than the prior session for both major exchanges, which was a sign of institutional accumulation. Decliners led advancers by a 23-to-13 ratio on the NYSE and by a 17-to-12 ratio on the Nasdaq exchange. For the third day in a row there were 0 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page. Stocks making new 52-week lows continued substantially outnumbering new 52-week highs on both major exchanges, while new highs on the NYSE and the Nasdaq exchange both remained in the single digits. The dearth of leadership reiterates the importance of remaining cautious until a new batch of leadership emerges. 

Charts courtesy www.stockcharts.com

The Russell 2000 Small Cap Index slid to a new multi-year low, but the other major averages positively reversed and closed higher, helping them avoid the same fate. Stocks shook off earlier losses and rallied in the last hour, which was the second time in 4 days that the major averages positively reversed on higher volume than the prior session after trading near 2008 lows. Earlier in the day, the National Association of Home Builders/Wells Fargo index of builder confidence fell to a lower-than-expected reading of 9 which was the lowest level since record-keeping began in 1985. This was the latest data point which suggested the economy remains weak.

The S&P 500 Index is down more than -43% this year which is the worst yearly performance since it fell -47% in 1931!  It is important to remember that the stock market officially topped out in October 2007, shortly after the first hints of the subprime and credit crunch surfaced in July. The losses related to the subprime and credit mess at firms around the world have approached $1 trillion, which is not an insignificant sum. Concurrently, corporate earnings at companies in the S&P 500 Index have contracted by -17% on average last quarter, according to data collected by Bloomberg. Looking forward, analysts believe that earnings will fall by -8.5% this year.

There has been a lot of talk recently among technical analysts regarding last week's retest of October's lows. One school of thought argues that last week's lows will be breached due to the fact that the market has not been able to rally since last Thursday's impressive positive reversal. The other school believes that the action is considered healthy, since the lows have not been violated (on a closing basis) and the pullback occurred on light volume. Instead of joining this fruitless debate we shall continue to objectively analyze what matters most: price and volume.  The market has completed Day 4 of its nascent rally attempt, which means that the window is open for a new follow-through day to emerge. Conversely, if last Thursday's lows are breached, the day count will be reset. 

PICTURED: The S&P 500 Index positively reversed for a gain on higher volume than the prior session (yet near average) after testing support for the second time in 4 days.


Adam Sarhan is a Registered Representative and Vice President of Investments with Source Capital Group (Member FINRA,SIPC) and offers a suite of services for individual and institutional investors. Mr. Sarhan earned a BA and MA in Political Science from Florida Atlantic University and he is well versed in capital markets. In addition, Mr. Sarhan completed the CAN SLIM® Masters Program presented by Investor's Business Daily. Investors with a significant financial interest may inquire about opening an account by calling the office locally at 954-785-1990 or 1-888-237-8399 or emailing to asarhan@sourcegrp.com. Further information is always available upon request. Contact us if you know anyone that may have an interest in receiving this or any of our other products.

 INDUSTRY  GROUP  WATCH  
The commentary and table below will show you important industry and/or sector information through today's close. Tracking certain areas or sectors for leadership characteristics helps you to find individual stocks with the "L" in CAN SLIM® - Leaders in a leading group
Energy Shares Led Gainers, But Industry Group Is Weak - Kenneth J. Gruneisen, Founder & Contributing Writer, www.CANSLIM.net

Financial shares continued to be the Achilles heel for the US equities market. Financial stocks ended up from their intra-day lows, yet the Broker/Dealer ($XBD -2.16%) and Bank ($BKX -0.95%) indexes still ended Tuesday's session with additional losses for new low closes. Broad-based losses weighed on most groups, but a late-afternoon rebound helped the Retail Index ($RLX -0.22%) nearly recover from its earlier loss. The tech sector ended mixed, with the Semiconductor Index ($SOX -1.96%) a standout laggard, a smaller loss for the Biotechnology Index ($BTK -0.31%), and closing gains for the Networking ($NWX +1.18%) and Internet ($DOT +1.43%) indexes after rebounding from early-afternoon losses. The Oil Services ($OSX +2.79%) and Integrated Oil ($XOI +3.52%) indexes were the session's best gainers, but energy related stocks are not a leading (the L criteria) industry group.  

Charts courtesy www.stockcharts.com

PICTURED 1: The Oil Services Index ($OSX +2.79%) remains near its 2008 lows and well below its 50-day and 200-day moving average lines.

Charts courtesy www.stockcharts.com 

PICTURED 2: The Integrated Oil Index ($XOI +3.52%) remains near its 2008 lows and well below its 50-day and 200-day moving average lines.

 
Industry Index Symbol Close Change % Change YTD % Change
Integrated Oil $XOI   915.74  +31.12  +3.52%  -41.39% 
Oil Services $OSX   134.16  +3.64  +2.79%  -55.66% 
Internet $DOT   167.57  +2.36  +1.43%  -40.65% 
Healthcare $HMO   806.76  +10.40  +1.31%  -61.92% 
Networking $NWX   133.63  +1.56  +1.18%  -48.79% 
Retail $RLX   239.46  -0.52  -0.22%  -41.18% 
Biotech $BTK   607.09  -1.90  -0.31%  -22.52% 
Gold & Silver $XAU   75.72  -0.58  -0.76%  -56.32% 
Bank $BKX   45.68  -0.44  -0.95%  -47.80% 
Semiconductor $SOX   191.89  -3.83  -1.96%  -52.91% 
Broker/Dealer $XBD   66.01  -1.46  -2.16%  -67.57% 


FEATURED  STOCKS UPDATE  

Latest Notes on All Featured Stocks | Recently Featured Stock Updates
The stocks below have been recently featured by CANSLIM.net. Our experts monitor these stocks and post updates on noteworthy action here.

Outlier's Strength May Be Considered Late-Stage Action - Kenneth J. Gruneisen, Founder & Contributing Writer, www.CANSLIM.net

An important point for prudent investors to remain cognizant of is that a strong stock normally builds several bases before it eventually tops out.  Needless to say, earlier stage bases are less risky than their later stage counterparts.  A general rule that is derived from studying leading stocks over the course of the past several decades is that if volume swells as the stock advances then odds favor that further price appreciation is likely. However, the converse is also true, and a lack of volume behind gains gives investors another reason to question a stock's ability to make a sustained advance in price.

Almost Family Inc. (AFAM -$-0.70 or -1.47% to $46.89) fell on lighter volume today, and its strength in a difficult market environment (the M criteria) throughout this year has made it an attention grabbing outlier.  Concerns would increase and technical sell signals would be triggered if an upward trendline violation, or worse, a 50-day moving average line violation occurs. This is especially important as we consider the extent of the stock's ongoing rally. It has been consolidating recently and noted, "prior highs in the $43 area are now an important support level to watch above its 50 DMA line."  Follow a sell disipline to protect and lock in profits and always limit losses whenever any stock falls more than 7-8% from your buy point.

The company has shown solid sales revenues growth and its quarterly and annual earnings increases have been reported well above the +25% guideline, which satisfies the C & A criteria. It recently reported strong sales revenues and earnings increases for the quarter ended September 30, 2008, and volume and volatility often increase in response to fundamental news (earnings).  Another positive is increasing ownership by top-rated mutual funds (the I criteria - institutional buying).  Some of these comments concerning the strong aspects of these key investment criteria were left out of the latest appearance in this Featured Stock Update section on November 11, 2008 under the headline, "Important to Know the Proper Time to Buy or Add (Averaging Up)", which included cautionary comments - "because it is too extended from a sound base to be buyable under the investment system's guidelines" (read here). That followed an earlier appearance in this Featured Stock Update section on October 29, 2008 with an annotated graph under the headline "Resilient Healthcare Firm Forming Possible Double Bottom" (read here). It ended October with gains on above average volume that helped it rally above its latest pivot point and trigger a new technical buy signal.

AFAM has traded up +122% since was first featured in yellow in the 5/21/08 CANSLIM.net Mid-Day BreakOuts Report on Wednesday, May 21, 2008 in the CANSLIM.net Mid Day Breakouts Report (read here).

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  Y - Today's better buy candidates based on the CAN SLIM® investment system and  highlighted by our staff of experts.   G - Previously featured in this report as yellow and now may no longer be buyable under the guidelines.

NOTE : ADDED FEATURES: Click the company name to view each selection's CANSLIM.net Stock Profile including a full summary of recent and previous analysis by our experts. On the CANSLIM.net Featured Stocks Page you can now click the column headings to alternately sort all currently Featured Stocks in ascending/descending order.
Daily Graphs Online Denotes link to Daily Graphs Online®

Last Updated Tuesday, November 18, 2008 at 4:30:00 PM by Kenneth Gruneisen and the expert staff at CANSLIM.net

Export to Excel (Most recent data)

Symbol/Exchange
Company Name
Industry Group 		Last Chg. Vol
(% DAV)		 Date when First Featured Price when First Featured Latest Pivot Point
Featured		 Status Resources
Latest Max Buy Price
GXDX - NASDAQ
Genoptix Inc
HEALTH SERVICES - Medical Laboratories & Research  		$35.40 -0.46 481856
(204.18%) 		8/7/2008 $37.25 PP = $39.89
G

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MB = $41.88
Most Recent Note - 11/18/2008 5:29:03 PM
G - Color code was changed to green based on weakness while encountering distributional pressure and consolidating above its 50 DMA line. Technically, its outlook is uncertain without a solid breakout above stubborn resistance in the $38 area. Its small supply of only 8.93 million shares (the S criteria) outstanding can contribute to great volatility. Whipsaw action and wide intra-day swings in recent weeks indicate uncertainty, which is a negative characteristic to its chart pattern. Gapped up on 11/07/08 for a considerable gain on heavy volume after reporting another strong quarter and raising guidance. Strong quarterly earnings satisfy the C criteria. Gaps up are a technical indication of institutional (the I criteria) buying demand, and its current Up/Down Volume Ratio of 1.6 is another indication of recent accumulation. Following proper buy discipline and sell discipline may be critical! Investors should always be patient for a confirmed technical buy signal and avoid chasing the stock more than 5% above its pivot point. Always be careful to limit losses at 7-8% if a stock ever falls that much from the purchase price. First featured in the 8/07/08 CANSLIM.net Mid-Day Breakouts Report (read here). - Kenneth J. Gruneisen, CAN SLIM® Certified, Registered Principal, Source Capital Group, Inc. (Members FINRA, SIPC)
>>> The latest Featured Stock Update appearance was 11/4/2008 including detailed analysis and an annotated graph. To View, click here.
View all notes | Alert me of new notes | CANSLIM.net Company Profile
AFAM - NASDAQ
Almost Family Inc
HEALTH SERVICES - Home Health Care  		$46.89 -0.70 280652
(85.51%) 		5/21/2008 $24.27 PP = $42.80
G

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MB = $44.94
Most Recent Note - 11/18/2008 5:28:48 PM
G - Consolidating after recently breaking out of a later-stage base. As previously noted, "prior highs in the $43 area are now an important support level to watch above its 50 DMA line." - Kenneth J. Gruneisen, CAN SLIM® Certified, Registered Principal, Source Capital Group, Inc. (Members FINRA, SIPC)
>>> The latest Featured Stock Update appearance was 11/18/2008 including detailed analysis and an annotated graph. To View, click here.
View all notes | Alert me of new notes | CANSLIM.net Company Profile

  ABBREVIATION KEY
 C = Current Quarterly Earnings | A = Annual Earnings Comparisons | N = New High / New Product or Service in Demand | S = Shares Outstanding | L = Leader in a Leading Group | I = Institutional Ownership | M = Market Direction | PP = Pivot Point | MB = Maximum Buy Price Under the Guidelines |



Kenneth J. Gruneisen has successfully completed the CAN SLIM® Certification Program.  Mr. Gruneisen is a Registered Principal and manages a Source Capital Group Member FINRA,SIPC) branch office offering personalized assistance. Investors with a significant financial interest in equities may inquire about opening an account by calling the office locally at (954) 785-1990 or 1-888-237-8399 or emailing to kgruneisen@sourcegrp.com. Further information is always available upon request. Contact us if you know anyone that may have an interest in receiving this or any of our other reports.

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THESE ARE NOT BUY RECOMMENDATIONS!  Comments contained in the body of this report are technical opinions only. The material herein has been obtained from sources believed to be reliable and accurate, however, its accuracy and completeness cannot be guaranteed. CANSLIM.net is not an investment advisor, hence it does not endorse or recommend any securities or other investments. Any recommendation contained in this report may not be suitable for all investors and it is not to be deemed an offer or solicitation on our part with respect to the purchase or sale of any securities. All trademarks, service marks and trade names appearing in this report are the property of their respective owners, and are likewise used for identification purposes only.

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