Eoin Treacy's view Following a broad market selloff investors and traders are posed with an important choice. Do you seek out the shares which have had the deepest decline in the hope that they are likely to have the largest bounce back, or do you identify the strongest shares on the auspicious that they are leading for a reason and may exhibit more consistent uptrends?

This table of the Nasdaq-100's best performers year-to-date makes for interesting reading. Netflix, First Solar, Sears and Research in Motion are all among this year's best performers so far. They were also among the biggest decliners last quarter. At least in Research in Motion's case there is talk of a takeover but otherwise there are good reasons these shares deteriorated so sharply. The deeply oversold conditions evident last year represented opportunities for nimble traders. However once the short covering has run its course the most likely scenario for the above shares is a lengthy support building phase. Longer-term investors may have a fundamental view as to whether these companies represent value at these levels but they are likely to be in for a wait. The above shares are currently outperforming on an absolute basis compared to their peers but this is likely to be a short-term phenomenon.

Shares hitting new highs or demonstrating relative strength in the midst of a period of heightened investor anxiety are noteworthy. They are clearly outperforming for a reason. Those interested in such companies view broad market trauma as an opportunity to increase their positions. That reflects a high degree of confidence in whatever the investment case for the sector is. Provided they remain consistent with a succession of ranges one above another and continue to find support in the region of a trend mean such as the 200-day MA they are good candidates to exhibit absolute and relative performance into the medium and potentially long term.

The Nasdaq-100 was the first mega cap index to retest its highs following the August pullback. It can therefore be considered among the world's leading stock market indices. It has held a progression of higher reaction lows since late August and is once again testing the 2400 level. A sustained move above that area would reassert the medium-term uptrend. Qualcomm has a relatively similar pattern to the Index.

Three sectors have been particularly notable for their outperformance over the last three years. These have been cloud computing, cutting edge health care and a select group of consumer companies that dominate their respective niches.

Cloud computing was an early leader following the credit crisis but the sector has gone through a significant winnowing process over the last year. Whereas at the beginning of 2011 the sector exhibited a high degree of commonality, that broke down in August. A number of clear leaders are still evident such as Apple, IBM and CheckPoint Software. (Also see Comment of the Day on September 14th). They have all held progressions of higher reaction lows and continue to find support in the region of their respective 200-day MAs. Both IBM and CheckPoint Software are currently in the region of potential areas of support. Declines below their respective December lows, held for more than a day or two could be considered critical trend inconsistencies.

Google broke out of an almost 2-year range in late December and appears to be consolidating in the region of the upper side of the congestion area. Intel broke the 5-year progression of lower major rally highs in October and continues to consolidate in the region of $23. A sustained move below that level would be required to question medium-term scope for continued higher to lateral ranging.

Cisco Systems rallied to break the more than yearlong downtrend in October, has been consolidating above the 200-day MA since and hit a new recovery high this week. A sustained move below $17would be required to question potential for some additional upside.

Amazon has now posted its largest reaction in almost three years, broke its progression of higher reaction lows and has encountered resistance in the region of the MA which has turned downwards. This is a marked loss of its previous uptrend consistency. It needs to rally strongly and hold the move beyond the short-term to begin to repair the damage and to offset potential for additional weakness.

EMC Corp, Citrix Systems, Cognizant Technology Solutions have all held progressions of rising lows following the August pullback. These need to hold if the upside is to be given the benefit of the doubt. Oracle and Teradata Corp posted deeper pullbacks recently, and have more work to do to reassert medium-term demand dominance.

BMC Software and Salesforce.com remain in medium-term downtrends and will need to break the break the progressions of lower rally highs to question supply dominance.

Following an abrupt decline Juniper Networks has at least paused in the region of $20 and appears to be building support.

Commonality is still evident across much of the cutting edge healthcare sector. Biogen broke out of a 10-year range in April, found support above it in September and continues to find support in the region of the MA.

Celgene broke out of a yearlong range in September, found support near the upper side of the range in December and has since rallied to test the 2008 peak. It is overbought in the short-term so potential for a consolidation has increased. However, a sustained move below the MA would be required to question medium-term scope for additional upside.

Gilead Sciences has been an underperformer since large 2008 but rallied out of a yearlong range this month, breaking the medium-term progression of lower rally highs. While somewhat overbought in the short term, a sustained move below $42 would be required to question medium-term upside potential. Amgen is also extending a breakout from a comparatively lengthy range.

Stericycle has been consolidating since May, following an impressive advance from the 2009 lows. The reaction to date has been similar to that posted between 2008 and 2009. Last week's upward dynamic is encouraging but a sustained move above $90 will be needed to confirm a return to medium-term demand dominance.

Cerner has lost momentum over the last six months but remains above the 200-day MA. It will need to hold above the $56 area if the medium-term upside is to continue to be given the benefit of the doubt.

Life Technologies found support in mid-August and pushed back above the MA and into the overhead top formation last week. A continued test of overhead trading appears likely provided it holds above the region of the MA. Mylan Inc. has also pushed back above its MA.

Vertex Pharmaceuticals dropped abruptly in September in a marked loss of consistency. It is currently rallying to unwind the short-term oversold condition but will need to find support above $26 on the first significant pullback to begin to suggest a return to demand dominance.

Teva Pharmaceutical trended lower from early 2010 and found at least near-term support near $35 in September. It has since posted a progression of higher reaction lows and rallied back above the MA. A sustained move below $40 would be required to check scope for continued higher to lateral ranging. Hologic has a comparatively similar pattern over the last year.

In the consumer sector, Bed, Bath & Beyond, Costco Wholesale, Dollar Tree Stores, Whole Food Market and Monster Beverage Corp have all held progressions of higher reaction lows and continue to find support in the region of their respective 200-day MAs. Breaks of these sequences could be characterised as major trend inconsistencies.

Ross Stores, Fastenal, O'Reilly Automotive and Starbucks are accelerating higher, becoming increasingly overextended relative to their respective 200-day MAs and the potential for a deeper pullback and at least a reversion towards the mean is increasing. A trailing stop may be appropriate for those interested in harvesting profits at such elevated levels.

In conclusion, a number of the above charts represent some of the more consistent uptrends evident anywhere. Over the course of the last few years they have gone through periods of relative outperformance and underperformance. However, on a risk adjusted basis, consistent trends offer some of the best potential opportunities to enter following reversions to the mean and to lighten during overextensions. This is an important consideration particularly in a time of increased volatility and heightened anxiety.