March 15, 2010

In ZYX Change Method, every trade must pass through six screens. In the first Change Screen, we are looking for macro changes. In this case, our long time readers know that we have been negative on medical devices industry because we anticipate going forward macro environment will not be conducive to maintaining present margins. The only exception has been $BSX (Boston Scientific) as we have anticipated improving margins.

The second screen is Fund Flow Analysis Screen. Here we are using proprietary indicators to dissect money flow. We have been seeing negative Fund Flow Indicators on $MDT (Medtronic) and $STJ (St. Jude Medical).… Please click here or the title below to read more.

$BSX is down substantially on FDA issues and competitors $MDT and $STJ have spiked up. These are minor paperwork issues and will not have a long term impact. Scale in on $BSX on dips. Scale in on $MDT and $STJ on spikes.