Breakouts Needed:

In any healthy market, breakouts are not only necessary but to see them act well POST the move is just as important. Breakouts that fail very quickly are a red flag. Many stocks are starting to show specific buy points which is an excellent development, and some are actually breaking out. This is very positive. Add to that benchmarks are now making it a habit of CLOSING on highs for the daily range. And for the second straight session, it rallied after a weak opening, shrugging off ominous news. Sure Fridays was an employment report, which seems like a month ago after this weekend’s horrific events, but it is our job to focus on how markets react and respond. Below is the chart of SMCI, a best-in-breed semiconductor name, and it is higher 11 of the last 12 sessions after a recent breakout above a double-bottom trigger of 287.83. If this can break above the very round 300 number this week look for a quick move to fill in the upside gap from 8/8 near 340. Other stocks will be looking to see how this breakout materializes, and if it is ready for a robust jump it could give other names on the fence of potential breakouts more confidence.

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