The major averages ended mixed as investors began accepting the notion that the economy will not expand sharply in the latter half of 2009. Volume totals were reported higher than the prior session totals on the NYSE and on the Nasdaq exchange.  Decliners trumped advancers by about a 2-to-1 ratio on the NYSE and on the Nasdaq exchange. There were only 2 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, less than the 4 issues that appeared on the prior session.

The market averages treaded water for most of the day as investors digested the latest economic report from the International Monetary Fund (IMF). The IMF released a report that said the global economic outlook for the latter half of 2009 will be lackluster at best. The IMF believes that the global economy will not begin to recover until 2010, which is past the Street's consensus. This sent the US dollar higher and a slew of commodities (and equities) lower. Over the past few months, we have discussed this delicate relationship between the US dollar and other asset classes (mainly stocks and commodities). At this point, the one clear trend is that the US dollar is inversely related to both stocks and commodities. So carefully following the greenback is important as the world gets smaller. Another tumble in oil prices dragged energy shares lower and reflected concerns that demand for energy would remain weak as the economy struggles to emerge from a recession that began nearly two years ago.

PICTURED: The S&P 500 Index closed below its 200-day moving average (DMA) line for the second session, ending down on lighter than average volume again.

Charts courtesy www.stockcharts.com

PICTURED: The Retail Index ($RLX +2.01%) bucked the mostly negative action in the broader market and posted a gain.  It recently encountered resistance at its 50-day moving average line and slumped under its May-June chart lows.  The weak action generally bodes poorly for retail issues, however each individual issue should be judged based upon its own merit.

NVE Corp (NVEC -$1.82 or -4.14% to $42.10) suffered a large loss today with above average volume, indicating distributional pressure as its fourth consecutive loss pressured it under its pivot point. It is testing its 50-day moving average (DMA) line, an important area to watch above a multi-month upward trendline that is the next important support level. Its color code was changed to green based deterioration, as its latest breakout has been completely negated. Its 6/19/09 gain with volume more than 2 times average had helped it rise from an "ascending base" type pattern to a new 52-week high and multi-year high, triggering its latest technical buy signal. It has a very small supply of only 4.67 million shares outstanding.  A small supply is generally considered a good sign with respect to the S criteria, yet could contribute to great volatility in the event of institutional accumulation or distribution. NVEC has traded up as much as +41.51% since it was first featured in yellow at $33.85 in the Friday, March 13, 2009 Mid-Day Breakouts Report (read here).

Earnings per share rose +38% in the period ended March 31, 2009 versus the year ago quarter, yet sales were up just +14% and, as previously noted, the company's sales revenues thus far have been rather minuscule.  At less than $7 million per quarter in each of the past 8 quarters, sales have growing at a mostly lackluster pace percentage-wise. Companies reporting more substantial sales revenues generally make more reliable buy candidates, while companies with little "meat on the bone" can be particularly vulnerable to bad stumbles, fundamentally and technically.  Nonetheless, this high-ranked Electronics - Components leader has a good quarterly and annual earnings growth history (C & A criteria). 

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.