The major averages ended lower for the second straight day, sinking on Wednesday with lower volume than the prior session. Decliners trumped advancers by about a 3-to-2 ratio on the NYSE and by a narrower 7-to-6 ratio on the Nasdaq exchange. There were only 4 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, lower than the 5 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 again.

Investors digested a slew of economic data, starting before Wednesday's opening bell, when ADP released its monthly survey which showed that employers slashed -298,000 jobs in August which was higher than the Street's forecast. The Labor Department released a separate report which said productivity, a measure of employee output per hour, jumped at a 6.6% annual rate during the second quarter. This was the highest jump in worker productivity in the second quarter since 2003.

Elsewhere, the Commerce Department released a report which showed that factory orders rose by +1.3% July. This was the largest increase in a year and suggests that companies are rebuilding inventories after a record decline in the first half of 2009. Just after 2PM EST the Federal Reserve released the minutes for their August meeting. Fed officials discussed the notion of extending the end-day to purchase so-called toxic assets to minimize any impact on the market. They also expressed concern about the pace of the economic recovery.

The market rally and the small group of stocks that are leading right now remain under pressure. Investors flocked into gold and silver as volume surged across the board in many related names. Unfortunately, the vast majority of gold and silver stocks sport very poor fundamentals and the overall group action has been lackluster at best. The strongest acting group was the Metal Ores-Gold/Silver group, a group currently ranked 194th, near the bottom of the 197 Industry Groups covered in the newspaper. This is another great example of low-ranked stocks bouncing from egregiously oversold levels.

PICTURED: The Dow Jones Industrial Average ended lower on lighter volume than the prior session, yet the volume total behind the 4th consecutive loss was above average again.

Charts courtesy www.stockcharts.com

PICTURED: The Gold & Silver Index ($XAU +8.55%) posted a considerable gain today, rallying toward its June high.

Aeropostale Inc  (ARO +$0.30 or +0.78% to $38.58) is a high-ranked leader in the Retail - Clothing/shoe group now consolidating near its pivot point and support at prior highs in the $38 area. It has endured some distributional pressure without closing under its old high close ($38.22 on 7/22/09), but deterioration leading to a close back in its prior base would raise concerns. Keep in mind, 3 out of 4 stocks tend to follow along with the direction of the major averages.  Weaker market conditions (the M criteria) have hindered its progress since its gap up gain for a new all-time high on 8/21/09 triggered a technical buy signal as it rose from a flat base pattern with almost 3 times average volume.

ARO was featured in yellow with new pivot point and max buy levels noted in the 8/21/09 Mid-Day BreakOuts Report (read here). It has a great annual earnings history (the A criteria), and the 2 latest quarterly comparisons showed +81% and +84% earnings increases, well above the investment system's +25% guideline. The number of top-rated funds owning an interest in its shares rose from 209 in Dec '08 to 239 in Jun '09, which is good news concerning the I criteria.

Disciplined investors avoid chasing stocks more than 5% above their pivot point, as doing so increases the chances that a normal pullback will prompt them to sell the stock -as investors should always limit losses by selling any stock that falls 7% from their buy price.  Healthy stocks in healthy market environments do not typically retreat under their pivot points by very much, so subsequent losses would raise concerns, particularly if volume swells behind and damaging declines.

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.