Seven trading days into 2013, and the market doesn’t look too bad, does it?
I’m encouraged that indices have been able to hold last week’s bullish gains. It tells me that a re-test of the September highs is a distinct possibility in the near-term.
When it comes to current holdings in the Ultimate Growth Stocks model portfolio, it would be easy to take quick profits but with nothing in the way of sell signals, it makes sense to give potential leaders in the portfolio more room to work.
It’s also good to see new leadership taking shape. Small-cap, mid-cap and large-cap stocks are all participating.
It took LinkedIn (LNKD) a while to get going, but buyers finally came into the stock Thursday. The stock broke out with conviction over prior resistance at $117.32. Volume totaled just over 3 million shares. It normally trades about 1.9 million shares a day. I wouldn’t be surprised to see this name take the leadership baton in 2013.
One yellow flag I see is the number of extended stocks out there. When extended stocks outnumber actionable buying opportunities — which is where we’re at now — it is reason to proceed cautiously. As I wrote last week, don’t force the issues by chasing growth names that have moved a lot already. They seem to be a dime a dozen at the moment.
