For the reasons stated above in the index market and the still-to-be-determined short-term outlook of the overall market for this week, there are no new mentions given this week in the newsletter. Nonetheless, after Wednesday's CPI report comes out, I will likely have one or two mentions that will be given on the message board.

By the same token, last week's mention on LI is still valid, especially since it is a Chinese stock and not sensitive to what happens to the U.S. Market.

LI Friday Closing Price - 38.90

LI is the Chinese equivalent of . It is a new company that started trading just 23 months ago at $15 and has already established itself as a favorite among Chinese stocks given that it made its all-time high just 18-weeks later at 47.20. In spite of all the weakness and selling of stocks over the past 6 months (most everywhere in the world), the stock got back up to 41.49 just 2 weeks ago, after having rallied 225% in value over the previous weeks, strongly suggesting that further upside is likely to come, perhaps even a new all-time high.

LI has built a breakaway/runaway gap in the weekly chart (most indicative of breakaway/runaway formations), which offers an upside objective of 59.78, to be reached within the next 7 weeks. In addition, this formation also gives a viable and dependable support area as the runaway gap down at 34.00 should not be closed.

Purchases of LI below 36.15 and using a 34.00 stop loss and having a 59.78 objective will offer a 6-1 risk/reward ratio. My rating on the trade is a 4 (on a scale of 1-5 with 5 being the highest). Chart-wise, this action seen the last 6 weeks, the formation in place, and the fact that Chinese stocks have been outperforming U.S. stocks the past few weeks and likely will continue to outperform them until the interest rate hikes stop, makes this trade very viable and attractive.