Stocks This Week: Buy Bank of America And Biogen – Forbes

The S&P dropped slightly during the week as expected. There are conflicting indications in the coming week. This is a holiday-shortened Thanksgiving period which usually brings a seasonal bias to the upside. The next projected turning point is on the 29^th which suggests that the market will continue to be in a corrective mode in the next week. The Hindenburg and Titanic dispersion sell signals are registering on both the NASDAQ and on the NYSE, so this coming week appears vulnerable. This condition has occurred in November once and in December twice, and the market was only flat to slightly down. The positive seasonality appears to muffle or blunt the bearish effect. And, I add that the monthly S&P cycle still points up. The net result of these conflicting indications in the coming week is likely to be volatile and largely unchanged prices by the end of the week. This week is followed by more constructive conditions. The end-of-month (EOM) numbers for November show a low on November 28^th and a high on December 7^th. This is not one of the stronger EOM periods; it ranks in the bottom half. The S&P has risen in 67.3% of the time for an average gain of 0.60%, the second lowest of all of the 12 monthly periods since 1915.

The Bank of America weekly cycle bottoms on the 24^th and tops on December 28^th. All seven buy signals have been successful in the prior year. The coming week has been the most bullish seasonal period in the month of November. The stock is likely to rally to the high $30 area in December.

Chart 1

Chart 2

The weekly Biogen cycle turns up on the 25^th and tops on December 4^th. Thirteen of fourteen buy signals have been successful in the last year. The 27^th has been seasonally bullish since 1992, rising 69% of the time for an average 1.9% gain. Relative strength has been strong as we see in graph 4. The shares will likely reach the $310 area by the first week of December.

Chart 3

Chart 4