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Why New Highs Before a Correction

Kevin Cook here for Steve...

What have we learned about the dips in this bull market? That there's a line a mile deep of portfolio managers waiting to buy their favorite stocks. And so if you aren't at your trading screen all day, you better not let your favorites go because you may not get them back.

Yesterday we reeled on "the valuation question" following Goldman's report that things were beginning to look frothy. But the way that strong bull markets typically evolve, stocks persist on the path from fully-valued to over-valued, especially with so many macro supports.

Is policy risk back with new budget negotiations in DC? Maybe, but my eyes are on two things that tell me the dips will be shallow and bought quickly on our way to new highs: (1) institutional net buying of stocks is still strong and (2) it is proven by broad market breadth.

Bottom line: Stay "heads down, picking stocks" into this earnings season. And if you need some fresh ideas, check out these articles...

Featured Commentaries

•  4 Shareholder-Friendly Cash Machines

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•  Technology Stock Roundup


Kevin Cook

Senior Stock Strategist

Zacks Investment Research

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What Are Today's Earnings Whispers Telling Us?

Earnings season is really heating up this week, and Zacks has briefly opened up its whisper research breakthrough to the public once more. Here's the most exciting part: It detects positive earnings surprises just before they are reported. And with previously unthinkable accuracy.

A flurry of new signals is expected within the next few days but only a select group of investors will be able to take timely advantage of them. Important: This portfolio closes to new investors Saturday, January 18.

See Surprise Stocks Now >>

Bull & Bear of the Day

Zacks Rank #1

Havertys (HVT)

Earnings are expected to rise by the triple digits in 2013 for this furniture retailer.


Zacks Rank #5

Stage Stores (SSI)

Holiday promotions cut into margins of this small town retailer.

Stock Picking Strategies

Black Gold + Open Blue = Mint Green  ››

Insurance Industry Stock Outlook - Jan 2014  ››

Roundtable Top Picks for the Week of Jan. 13th  ››

Funds Commentary

Zacks #1 Ranked Real Estate Mutual Funds  ››

Play a Rising Dollar with These ETFs  ››

Twitter Volatility Puts These ETFs in Focus  ››

Options Strategies

Getting Ready for Earnings Season with Options  ››

Video Reports

Market's View of Jobs Report

Zacks strategists weigh in on what, if any, impact the latest jobs report may have on the stock market.

What is Your Stock's Earnings Yield?

Kevin Matras talks about a stock's Earnings Yield and how to use it. Highlighted stocks include ACT, AHL, ANW, TRN and URI.

2 Japan Hedged ETFs for 2014

After an excellent performance in 2013, Japan Hedged ETFs are poised to shine again in 2014 (DXJ, DBJP)

Earnings HQ

Today's Noteworthy Earnings Before the Bell:   ››  BACFASTWNS

Today's Noteworthy Earnings After the Bell:   ››  KMICSXKMPEPBCLC

Get the First Calendar Made for Traders.

Visit the Zacks Earnings Calendar

Recent Earnings Winners

Company Symbol Reported Surprise %Price Chg
AEP INDUSTRIES INC AEPI Jan 14 +0.18% +3.55%
CORUS ENTERTAINMT B CJREF Jan 14 +0.60% +2.70%
LINEAR TECHNOLOGY CP LLTC Jan 14 +0.46% +1.57%
JP MORGAN CHASE & CO JPM Jan 14 +1.40% +0.07%

See All »

Best Earnings ESP Stocks  

Company Symbol Consensus
Accurate Est.
Reports Zacks Rank ESP
WESTERN DIGITAL WDC 2.07 2.11 Jan 22 1 +1.93
BALLY TECH INC BYI 0.96 0.99 Jan 30 1 +3.13
SOUTHWEST AIR LUV 0.28 0.30 Jan 23 1 +7.14
RAYMOND JAS FIN RJF 0.73 0.74 Jan 22 1 +1.37
NETFLIX INC NFLX 0.65 0.66 Jan 22 1 +1.54
Don't trade these stocks until you have read the Zacks ESP Guide ?


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