Sep 05
“Creme List” and Top Ten Changes
Look for changes tomorrow when the “Top Ten Stocks” and “Creme List” are posted over on Premium Content. Yesterday’s market drop had a major impact on the Point & Figure (PnF) graphs as many stocks I classified as Bull rotated to Bull-O. To define these terms, go to a PnF graph for Paychex (PAYX). Note the red line has a negative or “Bear” slope. Then move to the far right column and you will see it populated with X’s. I code such a graph as “Bear-X” and then give it a quantitative rating.
Now move on and type in the ticker, JNJ. When I looked at this graph, the blue line has a positive slope and there are X’s in the right-hand column. I call this a “Bull” PnF graph and the best one can find. If the graph is blue or has a positive slope and O’s are in the right-hand column, the stock is coded as Bull-O. This means the overall ranking is positive, but the price is beginning to drop. I would rather see a Bear-X than a Bull-O graph. A Bear-X is a stock with a red or negative slope for the graph, but X’s in the right-hand column.
Getting back to the “Creme List” of stocks, I went through the 140 plus stocks I track and checked every stock that had a PnF rating of “Bull.” Most of those stocks, due to the major downward move in the market, turned from “Bull” to “Bull-O.” When this happens, it shakes up the ranking system and that is why I expect to see changes this week in the “Creme List” and “Top Ten Stocks.”
These lists should be published sometime tomorrow over on Premium Content.
Lowell Herr
Photograph: National Air & Space Museum