Let's take a look at eSignal's "Hot Groups Scan." With this computer screening tool, one can spot quickly, at any time during the day, what industry group of stocks is performing the best or the worst.

A key time to be on the lookout for an industry move is when a sector starts to perk up. A sector includes many industry groups. For example, the technology sector comprises semiconductor, computer storage, computer peripherals and many other tech groups.

Tech has had a rough time in 2005. However, in mid-May, the NASDAQ market started to act better than the Dow Jones Industrials. The NASDAQ has many tech-related plays and, lo and behold, they started to perk up too.

Using eSignal's Hot Groups Scan on May 13, 2005 showed that the strongest acting group was Semiconductors, up 2.3% for the session, followed by Computer Storage Devices at 1.9%. Other tech groups doing well were the Computer Hardware and Computer Network stocks.

Computer Storage Stocks really caught my eye. They are makers of disk drives and storage systems. The theme: More and more data is being piled up and it needs to be stored -- it never ends. So, bigger and faster disk drives are needed, as well as related storage products and systems.

The computer storage stocks were really battered during the bear market that ran from 2000 to early 2003. However, they are now on the mend and earnings are improving for many. eSignal's Hot Groups Scan not only points the finger at the top groups but also the performance of the stocks within the group for that day.

On this particular day, Storage Technology Inc. (STK) was the leader, up 1.05 to $30.71 for a 3.5% appreciation. Also doing well was EMC Corp. (EMC), up 0.44 to $13.86, and Hutchinson Technology Inc. (HTCH), up 1.15 to $38.75. Other good gainers were Sandisk Corp. (SNDK) and Western Digital Corp. (WDC).

Researchers have found that an industry move can be the cause of more than 50% of a stock's appreciation. That is because a significant industry development or a big surge in demand for its products and services can lift the whole group.

After spotting an industry group that you believe is ready to make a move due to some good fundamental developments, the next step is to try to pinpoint the two or three stocks in the group that will be the leaders, the best performers.

Mr. Fasciocco's articles appear on www.tickertapedigest.com. He is an independent contributing writer for several national publications. He is also president of Corona Investment Management. To get a free trial subscription to the Ticker Tape Digest Pro Report, which comes out daily on the web with midday updates, send an email message to leo2@tickertapedigest.com. Mr. Fasciocco can be reached by email at leo2@tickertapedigest.com.

“Let's take a look at eSignal's "Hot Groups Scan." With this computer screening tool, one can spot quickly, at any time during the day, what industry group of stocks is performing the best or the worst. A key time to be on the lookout for an industry move is when..."

“eSignal has had continuous contract symbols for many years to allow users to chart U.S. domestic futures contracts. These familiar symbols use #F to replace the month and year code and can be entered into any of the eSignal windows. In a chart window, they display a continuous chart made by…"

"Ever since the market bottomed in 2002, the market has traded in a very stable fashion, producing a steady series of higher highs. In fact, just last month, the S&P and Dow peaked at levels unseen in 3 ½ years. While the market has been relatively strong, it has been…"

"One of the most oft-repeated comments made by traders over the past couple of years is "The market has changed." The perception that traders must change their methods or indicators with the market seems to be so well ingrained that the idea is rarely challenged. Having participated…"

Investor's Library

Review of Charting Commodity Market Price Behavior