The major averages ended higher this week but they snapped a 5-day winning streak and ended the session slightly lower on Friday. Advancers had a slight lead over decliners on the NYSE, but decliners led advancers by more than a 4-to-3 ratio on the Nasdaq exchange. On Friday, volume totals were lighter than the prior day's sessions, which was a reassuring sign suggesting that institutional investors were not dumping stocks. There were 26 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, down from the 33 issues that appeared on the prior session. New 52-week highs still outnumbered new 52-week lows on both exchanges while new lows were in the single digits yet again.

The stock market was closed on Monday in observance of Labor Day. On Tuesday, the Nasdaq Composite jumped to a fresh 2009 high close on heavier volume than the prior session. The major headline on Tuesday was that China posted gains considered by certain analysts as a "follow-through day" confirming its latest rally attempt. This may be very important, since China led the world markets higher in early March, many recent leaders are Chinese ADR's, and the immensely populous country continues to be a strong engine for economic growth.

Charts courtesy www.stockcharts.com

PICTURED: The Retail Index ($RLX -0.83%) rallied to a new 2009 high this week and paused.

Charts courtesy www.stockcharts.com

PICTURED: The Broker/Dealer Index ($XBD -1.02%) rallied to a new 2009 high this week and paused.

Ebix Inc (EBIX -$1.11 or -2.11% to $52.50) has held its ground reasonably well after another wild whipsaw-like shakeout briefly tested support, like its shakeout in mid-August that nearly tested prior chart highs. On the prior 2 sessions it dove as low as $46.25, briefly trading under its $47.62 "max buy" level, and it positively reversed for a big gain on 4 times average volume. Now it is too extended from an ideal buy point within the investment system guidelines. Sales and earnings increases in quarterly comparisons have been strong, but they have shown steady sequential deceleration which is of some concern.  EBIX has a small supply of only 6.62 million shares in the float, which has been previously noted as a reason one might expect great volatility.

Volatility like we have recently seen serves as a reminder for investors to always make disciplined buys and sells! Now EBIX rallied as much as +19.76% since featured in yellow in the 8/28/09 CANSLIM.net Mid-Day BreakOuts Report (read here) as it was reaching a new all-time high. A technical buy signal was triggered with a considerable gain backed by volume +81.94% above average as it cleared a cup-with-high-handle pattern after "3-weeks tight". It formed the big cup-with-high-handle shaped pattern (finding great support at its 50 DMA line) since weak action prompted it to be dropped from the Featured Stocks list on 10/07/08.

EBIX traded up more than +59% after it was first featured in the March 2008 CANSLIM.net News (read here). At that time its 50-day average daily volume was only 4,900 shares, whereas today its average volume is at 115,000 shares. Today there are 6.62 million shares (the S criteria) in the public float, so its share price still could be very volatile in the event of heavy institutional buying or selling. The number of top-rated funds owning an interest in its shares rose from 31 in Dec '08 to 55 in Jun '09, which is a good sign concerning the I criteria of the investment system. Do not be confused by the 3:1 split that took effect on 10/09/08. It has rebounded impressively and cleared its August '08 highs in the $40 area recently, after steadily climbing from this year's lows in the $17 range.

Color Codes Explained :
Y - Better candidates highlighted by our staff of experts.
G - Previously featured in past reports as yellow but may no longer be buyable under the guidelines.