Sunday, October 22, 2006
My method...
Finding longer term trades requires a slightly different mindset than finding swing trades. While both methods look for stocks that are oversold and ready to rally, but longer term trades require higher quality stocks that can withstand both the pressure of selling and the desire for buying. That is, bargain hunters should want this stock as others (swing traders, momentum players, etc.) leave.
Finding Stocks:
I use www.barchart.com exclusively for finding candidates. After the market close (usually 6 pm EST) the website posts 'downgrades' or stocks that have changed significantly when considering their technical indicators. I first select all 100 downgraded stocks and then sort by "Today's opinion". Stocks with opinions above 24% are for me. Usually these are stocks that are trending up, but suffered a (hopfully) temporary pullback due to earnings, downgrade, news, etc.
After finding stocks above 24%, I then look for stocks with at least 100k volume based on the last 5 days. I don't actually calculate the exact mean, but estimate. After removing those that do not qualify, I look for stocks with positive earnings. To do this, select the "Report History" page on the left hand side. Here I look for stocks with rising Total Revenue, Net Income, Earnings per Share. On the flipside, I also look for declining debt. I prefer to see a dividend, flat or declining share count, and increasing or flat margins.
After removing stocks that do not look good on the "Report History" page, I go to the "Detailed Report" and look at the quarterly earnings to confirm previous information (earnings, rev., share count, etc.). I also look at the institutional ownership. I don't like if >90% is owned by institutions because liquidity is controlled by the large players and can control the price (or so it appears).
Finally, I look at the chart to get an idea of intraday volatility, general trend, and possible support and resistance areas. No real criteria here, just to see what is going on in terms of price. Finally, I visit www.starmine.com to see how the company is expected to due at the next earnings, the date of next earnings (estimated), and the historical earnings (especially if they often miss or exceed).
I post those stocks that fulfill all these steps and give you my two cents for good entry and exit prices. Please do your own due diligence and do not rely solely on my recommendations. I am not responsible for your losses or wins. These are just my opinions.
Happy Trading,
Masterjaz
Finding Stocks:
I use www.barchart.com exclusively for finding candidates. After the market close (usually 6 pm EST) the website posts 'downgrades' or stocks that have changed significantly when considering their technical indicators. I first select all 100 downgraded stocks and then sort by "Today's opinion". Stocks with opinions above 24% are for me. Usually these are stocks that are trending up, but suffered a (hopfully) temporary pullback due to earnings, downgrade, news, etc.
After finding stocks above 24%, I then look for stocks with at least 100k volume based on the last 5 days. I don't actually calculate the exact mean, but estimate. After removing those that do not qualify, I look for stocks with positive earnings. To do this, select the "Report History" page on the left hand side. Here I look for stocks with rising Total Revenue, Net Income, Earnings per Share. On the flipside, I also look for declining debt. I prefer to see a dividend, flat or declining share count, and increasing or flat margins.
After removing stocks that do not look good on the "Report History" page, I go to the "Detailed Report" and look at the quarterly earnings to confirm previous information (earnings, rev., share count, etc.). I also look at the institutional ownership. I don't like if >90% is owned by institutions because liquidity is controlled by the large players and can control the price (or so it appears).
Finally, I look at the chart to get an idea of intraday volatility, general trend, and possible support and resistance areas. No real criteria here, just to see what is going on in terms of price. Finally, I visit www.starmine.com to see how the company is expected to due at the next earnings, the date of next earnings (estimated), and the historical earnings (especially if they often miss or exceed).
I post those stocks that fulfill all these steps and give you my two cents for good entry and exit prices. Please do your own due diligence and do not rely solely on my recommendations. I am not responsible for your losses or wins. These are just my opinions.
Happy Trading,
Masterjaz
# posted by Masterjaz Out @ 12:00 PM 
