The major averages extended a global advance as the US dollar continued falling and commodities gained amid speculation the economy has returned to growth. Gold climbed to near a record as the dollar slid to its lowest versus the euro in almost a year. Volume totals on the exchanges were reported higher than Tuesday's session, which showed that institutional investors were aggressively accumulating stocks. Advancers trumped decliners by over a 4-to-1 ratio on the NYSE and by over a 2-to-1 ratio on the Nasdaq exchange. There were 41 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, nicely higher than the 28 issues that appeared on the prior session. New 52-week highs were in the triple digits on both exchanges, while new 52-week lows were in the single digits yet again.

Both stocks and commodities extended their week-long gains as the US dollar continued to fall. The US dollar hit a fresh 1-year low against the euro which sent dollar denominated assets higher. The CRB Commodity Index, a basket of widely followed commodities, rallied nearly +2% today and is up +4.7% so far this week. Gold continues to soar after taking out resistance last week. The yellow metal advanced +1.4% today and closed at $1020.20 per ounce, which marks a new all time high record close. Meanwhile, silver prices hit a new one year high by hitting $17.43 per ounce.

The Federal Reserve said industrial production rose at a stronger than expected rate which was the latest batch of stronger than expected economic data. The Bloomberg Professional Global Confidence Index, a survey that measures global confidence, rose to +58.54 in September which is higher than the boom/bust reading of 50 and higher than last month's reading of 58.12. Confidence in the world economy held steady in September after reports suggested the recession may be finally over.

In the past we have written about the bottom that is being traced out in the housing market. Housing stocks soared today after the National Association of Home Builders/Wells Fargo confidence index rose to 19 which was the highest reading since May 2008. However, a reading below 50 means most respondents view conditions as negative but the fact that it is increasing is a healthy sign. The recent surge in homebuilders helped the Bldg-residential/commercial industry group to rise to 16 in the paper. Housing stocks still lack the fundamentals needed to meet the criteria of this powerful investment system but are beginning to strengthen.  

PICTURED: The benchmark S&P 500 Index broke above resistance and has not looked back. Volume patterns are healthy, picking up to above average levels behind the gains following Labor Day.

Charts courtesy www.stockcharts.com

PICTURED: The Bank Index ($BKX +4.03%) charged to a new 52-week high.  As long-time readers of this commentary should well know by now, the financial group led the market down-turn, and financials also led the market's upturn.   It has a long-standing history of working that way!  That is why it was given much attention in 2007 and 2008 as the financial indexes broke down and suffered huge losses. Each day we include the XBD and BKX because the financial group is a leading indicator.  When the financial indexes get weak, it is difficult to impossible for the broader market to enjoy an ongoing rally without eventually faltering.  In this case, financial stocks are getting strong, and it bodes well for the broader market outlook going forward.

NVE Corp's (NVEC -$2.08 or -3.31% to $60.75) touched a new 52-week high today and then negatively reversed for a loss on average volume.  It quickly got extended from its latest sound base, and it remains above its "max buy" level after having cleared its latest pivot point. It has a very small supply of only 4.68 million shares outstanding (the S criteria) which can contribute to greater than usual volatility. Be mindful of its still rather minuscule sales revenues. These concerns heighten the need for great discipline in trading (buying AND selling). It has shown bullish action since its last appearance in this FSU section on 9/01/09 which included an annotated graphs and analysis under the headline "Critical Chart Support Levels Tested Again While Market Weakens." The broader market's (the M criteria) improved strength was most certainly was a factor, as 3 out of 4 stocks typically move in sync with the major averages.

Prior chart highs are important support to watch now, and any deterioration leading to a close back into its prior base would negate the stock's latest bullish technical breakout raising concerns. Throughout its ongoing advance, NVEC has found support near its 50-day moving average (DMA) line (the red line). NVEC was first featured in yellow at $33.85 in the Friday, March 13, 2009 Mid-Day Breakouts Report (read here). This high-ranked Electronics - Components industry group leader has a good quarterly and annual earnings growth history (C & A criteria) and even showed acceleration in the latest report for the quarter ended June 30, 2009. In that period sales revenues were up +41% and earnings were up +53%, even bigger percentage increases than prior solid (+25% or better) earnings comparisons.  That is what we call earnings growth acceleration, and it is a very encouraging characteristic commonly seen in the market's biggest winners.

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.