Parexel Int'l Inc. (PRXL -$5.20 or -37.96% to $8.50) suffered another considerable loss today on very heavy volume following a streak of 3 prior losses with above average volume. Its last appearance in the Featured Stock Update section was on Monday, September 29, 2008 under the headline "Concerns Increase When Stocks Fall Back Into Prior Bases". A few days later the stock violated its 200-day moving average (DMA) line, triggering another technical sell signal. Based on the weak action it was dropped from the Featured Stocks list on October 2, 2008.

Whenever any stock breaks down into its prior base or violates its 200 DMA line, the technical deterioration should be recognized by investors as an indication that the stock will likely spend a longer time consolidating. Meanwhile, a lot can go wrong, which is why hanging on to a losing position is dangerous and leaves investors vulnerable to more devastating losses. The graph below shows a clear example of why investors should be disciplined about limiting losses whenever a stock buy falls 7-8% from your buy point.

PRXL quickly got extended after strong quarterly earnings prompted its 8/07/08 "breakaway gap" and appearance again in yellow in the CANSLIM.net's Mid-Day Breakouts Report (read here). The technical breakout was backed up with strong fundamentals - both of which are critical elements of the investment system. The high-ranked Medical/dental Service firm had then recovered impressively since being dropped from the Featured Stocks list on 4/15/08 following its earlier 200 DMA line violation. It had previously been featured in the August '07 CANSLIM.net News (read here) and in the June 28th, 2007 CANSLIM.net Mid Day Breakouts Report (read here). The latest technical action suggests that it may be a very long time, if ever, before we will spot this stock on the new highs list again.

Longstanding readers of this section in the CANSLIM.net After Market Report are well versed on the importance of watching for a stock that has broken out to stay above prior chart highs. Once the bears show up and the stock falls to a close back under its prior chart highs, a breakout has been fully negated, and then the odds start favoring the possibility of further declines.

Parexel Int'l Corp (PRXL -$0.98 or -3.63% to $28.01) was down today on light volume, falling toward its 200 DMA line. Concerns were raised last week as it violated its 50 DMA line and also fell under prior chart highs in the $29 area - repeatedly noted as important support levels to watch. Strong quarterly earnings prompted its 8/07/08 "breakaway gap", and its technical breakout was backed up with strong fundamentals - both of which are critical elements of the investment system. This high-ranked Medical/dental Service firm last appeared in this "Featured Stock Update" section on Tuesday, August 12, 2008 under the headline Pullback After Breakout Quickly Got Extended From Prior Base. It had recovered impressively since being dropped from the Featured Stocks list on 4/15/08 following its 200 DMA line violation. Previously featured in the August '07 CANSLIM.net News (read here) and in the June 28th, 2007 CANSLIM.net Mid Day Breakouts Report (read here).

Statistically, about 40% of winning stocks will pull back after breaking out. In other words, it is not uncommon for stocks to pullback and retest support near their pivot point after breaking out. It is important to see the bulls show up and offer support at or above the pivot point. This may offer investors a chance to increase their exposure before the stock continues advancing. However, an important caveat is that volume should contract as the stock pulls back towards its pivot point. Heavy volume behind losses can be cause for concern, especially if the stock does not find support at its pivot point. Whenever a recent breakout is completely negated by a loss that leads to a close back in the prior base, this is construed as a technical sell signal and a sign that the bears are regaining control.

Parexel Intl Corp (PRXL -$1.26 or -3.95% to $33.18) gapped down today, pulling back from all-time highs for its second considerable loss on above average volume in a row. The stock quickly got extended after strong quarterly earnings prompted its 8/07/08 "breakaway gap" and appearance again in yellow in the CANSLIM.net's Mid-Day Breakouts Report (read here). The technical breakout was backed up with strong fundamentals - both of which are critical elements of the investment system. This high-ranked Medical/dental Service firm recovered impressively since being dropped from the Featured Stocks list on 4/15/08 following its 200 DMA line violation. It had previously been featured in the August '07 CANSLIM.net News (read here) and in the June 28th, 2007 CANSLIM.net Mid Day Breakouts Report (read here).

Prior chart highs in the $29 area are now a very important support level the stock should stay above while consolidating. Any additional pullbacks on lighter volume might offer disciplined investors an opportunity to accumulate shares closer to the stock's pivot point. However, whenever the proper buy discipline is not adhered to, sloppy buys can lead investors into making even more mistakes. Investors who may have taken undue risks and recently chased the stock, buying PRXL when it was too extended from a sound buy point, may now be forced to sell the stock based on the rule of limiting losses if a stock falls more than 7-8% from your buy point. When an investor does not strictly limit losses at that level, they keep themselves open and vulnerable to even greater losses which can be far more damaging to their portfolio values.

The stock triggered a technical buy signal with bullish action that prompted its appearance in yellow in the Friday December 21, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a new $23.89 pivot point and a $25.08 maximum buy price (adjusted for 2:1 stock split of 3/4/2008). It continued higher, then spent the next couple of weeks consolidating back toward its prior chart highs. It found solid support as it consolidated its recent move above its 50 DMA line while the rest of the market tanked. The fact that this stock has not violated its longer term upward trendline is a strong vote of confidence from the institutional community. If that important upward trendline is breached and its recent lows near $24 are taken out, then a technical sell signal will be triggered which raises concern.

A very important technical tool that savvy investors have learned to incorporate in their technical analysis is the 50-day moving average (DMA) line. The 50 DMA line plays a pivotal role relative to a stock's price. If the price of a stock is above its 50 DMA then odds are that its 50 DMA will act as formidable support. Conversely, if the price is below its 50 DMA then the moving average acts as resistance. Healthy stocks sometimes trade under their 50 DMA lines briefly, but usually a strong candidate will promptly bounce and repair a 50 DMA violation. When a stock has violated its 50 DMA line and then lingers beneath it, the stock's outlook gets worse and worse as it spends a greater period of time trading under that important short-term average line. Once the 50 DMA line starts sloping downward it should also be acknowledged that the stock has been struggling for a while, and it might be time to reduce exposure and look for places to put that money to work in stronger buy candidates.

Parexel Int'l Corp (PRXL -$0.45 or -1.70% to $26.95) closed slightly lower today on below average volume as this high-ranked leader fights to stay above its 50 DMA line and a multi-month upward trendline. It was one of very few stocks that weathered the recent (bearish) storm without any great technical damage. PRXL was first featured in the June 28th, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a $41.55 pivot point and a $43.63 maximum buy price. However, the stock spent the next few weeks consolidating near its 50 DMA line. Later, encouraging action helped to prompt a more detailed write up in the August 2007 edition of CANSLIM.net News (read here) with a pivot point of $43.64 and a $45.82 maximum buy price, but the stock slumped under its 50-day moving average (DMA) line and didn't start acting better until October. The latest action may be an indication that it is finally picking up momentum. Regardless of how promising a stock might be, disciplined investors know to always limit losses at 7-8% in order to avoid more serious losses.

The stock triggered a technical buy signal with bullish action that prompted its appearance in yellow in the Friday December 21, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a new $47.77 pivot point and a $50.16 maximum buy price. It continued higher, then spent the next couple of weeks consolidating back toward its prior chart highs. It found solid support as it consolidated its recent move above its 50 DMA line while the rest of the market tanked. It was encouraging to see it stay above its 50 DMA line and not trigger any definitive technical sell signals, proving especially resilient amid the broader market's widespread carnage. This was a strong vote of confidence from the institutional community. Recent chart lows, its 50 DMA line, and an upward trendline connecting its September-December highs should be watched as important support levels, where subsequent violations may trigger technical sell signals and raise concerns.

Volume is a vital component of technical analysis. Prudent investors that incorporate volume into their stock analysis have often benefited several fold. Ideally, healthy stocks will more often tend to rise on higher volume and pullback on lighter volume. Volume is a great proxy for institutional sponsorship. Conversely, high volume declines can be ominous, as this usually signals distribution and further price deterioration are more likely to follow.

Parexel International Corp. (PRXL +$7.37 or +14.66% to $57.63) gapped up and rallied to a new all time high with a considerable gain on more than 7 times average volume after the company reported better than expected earnings results. The company said its fiscal second-quarter earnings and revenue jumped by +25% and +29%, respectively, driven by demand for its clinical research services. This high-ranked leader was one of very few stocks that weathered the recent (bearish) storm without any great technical damage. PRXL was first featured in the June 28th, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a $41.55 pivot point and a $43.63 maximum buy price. However, the stock spent the next few weeks consolidating near its 50 DMA line. Later, encouraging action helped to prompt a more detailed write up in the August 2007 edition of CANSLIM.net News (read here) with a pivot point of $43.64 and a $45.82 maximum buy price, but the stock slumped under its 50-day moving average (DMA) line and didn't start acting better until October. The latest action may be an indication that it is finally picking up momentum. Regardless of how promising a stock might be, disciplined investors know to always limit losses at 7-8% in order to avoid more serious losses.

A few months later, the stock triggered a technical buy signal, with bullish action prompting its appearance in yellow in the Friday December 21, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a new $47.77 pivot point and a $50.16 maximum buy price. The stock continued higher, then spent the next couple of weeks consolidating back toward its prior chart highs. It found solid support as it consolidated its recent move above its 50 DMA line while the rest of the market tanked. It was encouraging to see this stock stay above its 50 DMA line and not trigger any definitive sell signals amid the broader market's widespread carnage. This was a strong vote of confidence from the institutional community. The stock is well above its max buy level after enjoying a sizeable gain on a very healthy earnings report, and as long as it continues acting well, it deserves the bullish benefit of the doubt. Recent chart lows, its 50 DMA line, and an upward trendline connecting its September-December lows should be watched as important support levels.

Parexel International Corp. (PRXL -$0.03 or -0.06% to $48.78) is pulling back toward prior chart highs in the $47-48 area that were a previous resistance area. It triggered a technical buy signal late last week, when it was featured in the Friday December 21, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a $47.77 pivot point and a $50.16 maximum buy price. The stock spent the next two days rallying into new high territory and above its max buy level with lighter volume. It was encouraging to see very light volume as this stock pulled back, which suggests that the consolidation is normal and not a rush to the exits by the institutional community. As long as this stock avoids any closes under its prior chart highs the latest technical breakout remains intact.

PRXL was featured in the June 28th, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a $41.55 pivot point and a $43.63 maximum buy price. However, the stock spent the next few weeks consolidating near its 50 DMA line. Later, encouraging action helped to prompt a more detailed write up in the August 2007 edition of CANSLIM.net News (read here) with a pivot point of $43.64 and a $45.82 maximum buy price, but the stock slumped under its 50-day moving average (DMA) line and didn't start acting better until October. The latest action may be an indication that it is finally picking up momentum. Regardless of how promising a stock might be, disciplined investors know to always limit losses at 7-8% in order to avoid more serious losses.

Volume is a vital component of technical analysis. Prudent investors that incorporate volume into their stock analysis have often benefited several fold. Ideally, healthy stocks will more often tend to rise on higher volume and pullback on lighter volume. Volume is a great proxy for institutional sponsorship. Conversely, high volume declines can be an ominous, as this usually signals distribution and further price deterioration are more likely to follow.

Parexel International Corp. (PRXL -$0.67 or -1.64% to $40.07) fell on above average volume after recently violating support at its 50-day moving average (DMA) line and upward trendline. Last Friday, September 7th, 2007, PRXL sliced below its 50 DMA line, but it failed to find support and promptly repair the damage. This stock serves as a great example of how important it is to wait for a proper technical buy signal to be triggered before buying a stock. PRXL was featured in the June 28th, 2007 CANSLIM.net Mid Day Breakouts Report (read here) with a $41.55 pivot point and a $43.63 maximum buy price. However, the stock spent the next few weeks consolidating near its 50 DMA line. Later, encouraging action helped to prompt a more detailed write up in the August 2007 edition of CANSLIM.net News (read here) with new pivot point of $43.64 and a $45.82 maximum buy price. Since then, however, the stock failed to trigger a technical buy signal or make any significant progress. This exemplifies the importance of patience and discipline. Meanwhile, its latest quarterly earnings report showed increases that fell below guidelines. Prior chart lows in the $38-39 area are the only remaining support above its 200 DMA.

PRXL appeared on Tuesday, August 21st, 2007, in the CANSLIM.net After Market Report (read here) just before it sliced below its 50 DMA line. That report said, "the stock has failed to trigger a technical buy signal or make any significant progress. Instead, it is continuing to consolidate, and the wider intra-day price swings evident in its recent trading are a sign of looming uncertainty. Generally, the sloppier trading pattern does not bode well. Disciplined investors would be waiting for market conditions (the "M" criteria) to improve with a follow-through day, and watching for the stock to produce solid gains backed by heavier than normal volume." One week later, on August 29, 2007, the Nasdaq composite produced a follow through day which confirmed the market's latest rally attempt. However, instead of breaking out and rallying alongside the major averages and other leading stocks, PRXL has failed to make any price progress on above average volume. Instead, it slid below its 50 DMA line and upward trendline with volume heavier than average as it fell recently. It would need to convincingly repair these important technical violations for the odds to improve for it making a more considerable advance. Disciplined investors always limit losses at 7-8% to avoid more serious losses.

Group action plays a very important role, and experienced investors learn that they can increase their odds of picking a great winner by always focusing their buying efforts in the market's leading groups. The "L" criteria tells us to choose leading companies in leading industry groups, thus it is suggested that investors choose from the top quartile of the 197 Industry Groups (listed in the paper most days on page B4). A classic example of the success enjoyed by many CANSLIM.net readers usually starts when an investor reads a CANSLIM.net report and buys a featured stock before it has risen above the pivot point by greater than 5%. After a stock breaks out above its pivot point, there is only a +5% window that investors have to purchase the stock under the proper guidelines. Once a stock rises above the "maximum buy price" the risk of a shake out balloons, meaning that even a normal retracement in the stock might force you to employ the 7-8% loss cutting rule. Much can be told by the stock's daily action in the weeks and months that follow a breakout. Typically, a light volume and orderly pullback suggests that the bulls remain in control. However, high volume pullbacks that violate support paint a totally different picture.

Parexel International Inc.

- Kenneth J. Gruneisen

Ticker Symbol: PRXL (NASDAQ)

Industry Group: Research Services

Shares Outstanding: 27,800,000

Price: $40.43

Day's Volume: 358,400 7/31/2007

Shares in Float: 26,400,000

52 Week High: $43.54 7/6/2007

50-Day Average Volume: 248,900

Up/Down Volume Ratio: 1.6

Pivot Point: $43.64 7/6/2007 high plus .10

Pivot Point +5% = Max Buy Price: $45.82

Web Address: http://www.parexel.com/

C A N S L I M | StockTalk | News | Chart | SEC | Zacks Reports

CANSLIM.net Profile: Parexel International Corporation, a bio/pharmaceutical services company, provides contract research, medical marketing, consulting, and informatics and advanced technology products and services to pharmaceutical, biotechnology, and medical device industries worldwide. The company operates through three segments: Clinical Research Services, PAREXEL Consulting and Marketing Services, and Perceptive. Parexel International Corporation was founded in 1983 and is headquartered in Waltham, Massachusetts. PRXL has increased its earnings per share by well above the +25% guideline versus the year earlier period in each of the past four quarterly comparisons, satisfying the "C" criteria. The company hails from the Medical-dental services group which is presently ranked 44th on the 197 Industry Groups list, which places in the much coveted top quartile of industry groups needed to satisfy the "L" criteria.

What to Look For and What to Look Out For: Look for PRXL to find support and promptly repair its 50 DMA violation with strong gains first, or otherwise this candidate's odds may be too poor to justify investors holding it or taking on any new interest. Since it undercut its prior chart highs and 50 DMA while consolidating for several weeks, a new pivot point is now being based on the latest chart high. The company will release Fourth Quarter and Fiscal Year 2007 financial results on Monday, August 6, 2007 after the close of the stock market, and earnings news is often a catalyst for greater volatility and volume. Always limit losses per the 7-8% sell rule, and never hold a stock if it falls more than that much from your purchase price. Also, keep in mind that satisfying the "M" criteria calls for waiting for the major averages to produce a new follow-through day before initiating any new positions. Market conditions need to show technical improvement, otherwise odds are stacked against investors for now.

Technical Analysis: PRXL triggered a technical buy signal and appeared in the June 28th, 2007 CANSLIM.net After Market Update with an annotated graph (read here). However it failed to make great progress, and recently was finding support much as it previously had found support near its 50-day moving average (DMA) line, building a base-on-base pattern. Concerns were raised by its latest loss on above average volume leading it to close under its prior high closes and under its 50 DMA line, as well as slightly breaching an upward trendline connecting the prior months' lows. Still, the stock is a high-ranked leader that has been steadily rallying for the past few years and is currently trading just -7.1% shy of new all-time highs. History shows us that stocks that have cleared prior resistance have the greatest chance of advancing meaningfully.

Group action plays a very important role, and experienced investors learn that they can increase their odds of picking a great winner by always focusing their buying efforts in the market's leading groups. The "L" criteria in CAN SLIM(R) tells us to choose leading companies in leading industry groups, thus it is suggested that investors choose from the top quartile of the 197 Industry Groups (listed in the paper most days on page B4). A classic example of the success enjoyed by many CANSLIM.net readers usually starts when an investor reads a CANSLIM.net report and buys a featured stock before it has risen above the pivot point by greater than 5%. After a stock breaks out above its pivot point, there is only a +5% window that investors have to purchase the stock under the proper guidelines. Once a stock rises above the "maximum buy price" the risk of a shake out balloons, meaning that even a normal retracement in the stock might force you to employ the 7-8% loss cutting rule. Much can be told by the stock's daily action in the weeks and months that follow a breakout. Typically, a light volume and orderly pullback suggests that the bulls remain in control. However, high volume pullbacks that violate support paint a totally different picture.

Parexel International Corp. (PRXL +$0.45 or +1.07% to $42.40) jumped to a new 52-week high with a gain today backed by above average volume. This stock was featured in today's CANSLIM.net Mid Day Breakouts Report (read here) with a $41.55 pivot point and a $43.63 maximum buy price. PRXL sports a healthy Earnings Per Share (EPS) rating of 88 and a very healthy Relative Strength (RS) rating of 86. The company has managed to increase its earnings by above the +25% guideline in each of the past four quarterly comparisons versus the year earlier, satisfying the "C" criteria. PRXL resides in the Medical/Dental Services group which is currently ranked 46th of out the 197 Industry Groups covered in the paper, placing it in the much preferred top quartile and satisfying the "L" criteria. On Wednesday, PRXL jumped above its pivot point with gains backed by volume that was more than +50% above average, a reassuring sign of institutional buying demand (the "I" criteria) that was sufficient to trigger a proper technical buy signal. It was very encouraging to see PRXL follow through on Thursday with another gain on above average volume. This stock is approaching its "maximum buy" price of $43.63, a level above which it would be considered too extended from a proper buy point within guidelines. As always, it is of the utmost importance to sell a stock if it drops 7-8% below your purchase price.

Pulling Parachute Early Can Spare Yourself Some Pain - Tuesday, October 28, 2008

Concerns Increase When Stocks Fall Back Into Prior Bases - Monday, September 29, 2008

Pullback After Breakout Quickly Got Extended From Prior Base - Tuesday, August 12, 2008

Concerns Remain While 50 DMA Line Acts As Resistance Now - Tuesday, April 08, 2008

Support at 50 Day Moving Average Line Being Tested Again - Thursday, March 06, 2008

Rare Leader Surviving and Thriving in Tough Market - Thursday, January 24, 2008

Pullback to Prior Chart Highs on Light Volume is Healthy - Friday, December 28, 2007

Noted Deterioration Has Occurred - Thursday, September 13, 2007

Stock Resilient Despite Shortcomings In Earnings Growth Rate - Tuesday, August 21, 2007

50 DMA Breach Needs Prompt Repair - 8/1/2007

More Gains After Gapping Up - Thursday, June 28, 2007

Parexel International Inc.	- Kenneth J. Gruneisen
Ticker Symbol: PRXL (NASDAQ)	Industry Group: Research Services	Shares Outstanding: 27,800,000
Price: $40.43	Day's Volume: 358,400 7/31/2007	Shares in Float: 26,400,000
52 Week High: $43.54 7/6/2007	50-Day Average Volume: 248,900	Up/Down Volume Ratio: 1.6
Pivot Point: $43.64 7/6/2007 high plus .10	Pivot Point +5% = Max Buy Price: $45.82	Web Address: http://www.parexel.com/