Double Trouble | stockbee


Double Trouble

RTI and FFH were two stocks from the earnings breakout list. Now the earnings information was available early morning itself. The study of episodic pivots helps you in to getting such moves based on probability. Both were low risk trade from early morning. The earnings season has proved to be very good and more than 25 candidates showed up which offered 20% plus returns and some offered 5 to 10 points moves in few days.

Following the earning lead breakout can give you good insight in to markets reaction to earnings.Take RTI, it had a earning acceleration some 10 quarters back. Since then in 7 out of 10 quarters it has had triple digit earnings growth and in the process gone up from around 12 to 92. Now how many stocks have those kind of triple digit earnings growth for that period of time. It has an annualised EPS growth of 341%. Similar to tracking 100% plus movers, if you track stocks making triple digit earnings growth or more, you will find some very good long term winners. It might even lead to few triple digit years for your portfolio.

Market Monitor

Total 4% plus bullish breakouts=111
Total 4% plus bearish breakouts= 48
65 day bullish/bearish ratio= 964/187
Stocks up 50% or more in a month=19
Stocks up 25% or more in a month=154
Number of stocks with 100% plus move = 397
Number of stocks up 200% or more = 89
4% plus signals for 100plus universe=21
4% plus signals for 200plus universe=4

Stocks which had 100% move in last 260 days from the low and which are up more than 4% on higher volume. Today's minimum volume is above 100000. To understand how to trade this see my earlier post "How to find a stock which makes 1500% move in a year".
ASTI,Ascent Solar Technologies Inc (Google  Yahoo  Earnings  Chart
FFH,Fairfax Financial Holdings (Google  Yahoo  Earnings  Chart
GLBC,Global Crossing Ltd (Google  Yahoo  Earnings  Chart
HOTJ,House of Taylor Jewelry Inc (Google  Yahoo  Earnings  Chart
MSI,Movie Star Inc (Google  Yahoo  Earnings  Chart
RTI,Rti Internat Metal Inc (Google  Yahoo  Earnings  Chart
UCTT,Ultra Clean Holdings (Google  Yahoo  Earnings  Chart


gosu said...

Since "stocks up 50% or more in a month=19" is approaching your previous mentioned key number of 20, do you think we are approaching the overbought indicator, that might lead to reversal?

Pradeep Bonde said...

The 20 number was reached on 20th February with 21 stocks up on that day. Since then market has been correcting. The number is more indicative of likely correction zones. Similarly when it reaches below 3 it is indicative of likely upside move.

gosu said...

Kool. Thank you Pradeep.
The indicator I have been looking at is the percentage of stocks above their 200 day Moving average listed here.
If this figure gets above 75, it usually indicates a correction, but when this figure gets below 30, it indicates an upside move.

Pradeep Bonde said...

The concept is similar. Conceptually after a strong move there is buyer exhaustion which leads to correction. Similarly there is seller exhaustion on down moves.

Tom DeMark uses the logic of buyer/seler exhaustion in most of his ideas in New Market Timing Techniques: Innovative Studies in Market Rhythm & Price Exhaustion. He uses the concept on individual stock very innovatively.

gosu said...

Thanks Pradeep.
Once the indicators now get to the oversold condition, that is:
Stocks up 50% or more in month is close to 3, I will start using your formulas to find stocks or select stocks from the "Double trouble" list.
Right now, with the correction imperative, I am thinking all of them will stop out.

Art said...

I just saw this on a Telechart Form regarding MSI. Would be interested in your take on it when you have time:

>>>I hope all are aware that MSI and Frederick's of Hollywood are "merging", and since FOH holdings is not publically traded, it is difficult to determine how the current shares of MSI will be affected. MSI is going to issue 27 million shares of their stock to the FOH Holdings and also put up for sale $20 million of new stock. Currently the float is only about 12Mill. shares. Since MSI earnings announced first on 2/13 didn't cause a great uptrend ( they were good) the recent uptrend might be due to rumors on FOH unpublished earnings. I would recommend that you read the last 10Q before making a decision and play it tight. IMO.

Pradeep Bonde said...

It is not a buy at this stage. It came on Double Trouble scan at 1.09 price since then it has almost tripled. I am aware of the merger, it was announced long time ago.